Signs of softening national market

Mortgage Guaranty Insurance Corp. reported its national market trends index fell to 6.7 in the fourth quarter of 2002, from 6.9 in the third quarter and 6.92 a year earlier, reflecting sluggish economic conditions nationally.

Single-family housing markets remained stable nationwide despite the decline. But more areas of the country showed some softening and reduced appreciation rates.

The index, a barometer of single-family real estate market conditions, averaged 6.82 for the year, the lowest annual average since 1995 when the reading was 6.71. The quarterly index has been steadily trending lower since reaching an all-time high of 7.75 in the fourth quarter of 1999. “Overall, we are seeing changes in the housing markets as the rate of home price appreciation slows,” said Neil Siegel, senior market analyst. “If there is any segment where some softness is evident, it is in the market for higher-priced homes.”

In the fourth quarter, San Francisco was downgraded from “stable” to “soft.” San Jose was rated “weak.” Riverside, San Bernardino and San Diego were listed as “strong.”