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Residential property price falls in US slowing

The latest home price index published by First American CoreLogic found that house prices across the country fell by 10.4% in October, a slight improvement over September's 11.2% decline.

November prices are expected to show the trend is continuing. 'The consistent deceleration over the past two months with November indicating the same trend in price declines is encouraging because it could portend the trough in price declines,' said Mark Fleming, chief economist for First American CoreLogic.

He predicts that property prices will continue to fall in 2009 but at a slower rate. 'The rapid contraction in the economy, deteriorating labour markets, the large inventory of unsold homes and increasing defaults suggests that home prices will continue to decline but with a moderating pace throughout 2009,' he said.

Analysts are encouraged by early preview data for November which indicates a continued improvement with an anticipated decline of 9.6%. When the figures are taken together property prices have now maintained a steady annualized depreciation rate of between 10 and 11% for nine months in a row.

'This is perhaps signaling a forming floor under what have been free-falling home prices. That's not to say price declines are over, not by any means,' he added.

The research shows that California is the worst performing market followed by Nevada, Arizona and Florida. But, surprisingly Rhode Island and Wyoming are in the top 10 for price declines.

West Virginia, South Dakota and Texas are the only states exhibiting meaningful price increases, according to the data. However all states posting annual price increases account for just 13% of the US population.