Home Prices Exhibit "Improving Declines"

National home prices, including distressed sales, declined by 3.7% in December 2009 when compared with December 2008, according to First American CoreLogic and its LoanPerformance Home Price Index. This was a significant improvement over November's year-over-year price decline of 5.3%. Excluding distressed sales, year-over-year prices declined in December by 3.3%; and in November the non-distressed HPI fell by 5.0% year-over-year. This improvement is taking place as the real estate market is getting further from the period of peak distress in home prices, according to First American CoreLogic. On a month-over-month basis the national average of home prices declined moderately, falling by 1.0% in Dec. 2009 compared to November 2009, indicating seasonal slowing in a fledging housing recovery. The national HPI is projected to fall an average of 4.4% through April 2010, as high levels of unemployment, housing inventories and foreclosures continue to exert downward pressure on prices. The forecast indicates that the future path of house prices after April will be significantly impacted by whether the tax credit is allowed to expire or is once again extended. Nationally, the HPI 12-month forecast is expected to rise 3.5% excluding distressed sales; and up 2.7% including distressed sales by December 2010. When distressed sales were included, Nevada (-20.8%) remained the top-ranked state for annual price depreciation in December, followed by Arizona (-12.6%), Idaho (-11.4%), Florida (-11.3%) and Michigan (-10.8%). Of these five states, all but Michigan showed month-over-month decreases in their HPI between November and December 2009. Excluding distressed sales, the worst five states for year-over-year price declines changed slightly. Nevada (-18.8%) still holds the top spot, followed by Arizona (-11.8%), Florida (-10.3%), Michigan (-10.0%) and Maine (-9.1%).