Study Predicts Riskiest Markets for Price Drops

Home prices are likely to fall still more, according to a new study by mortgage insurer PMI Group Inc.

The study predicts that home prices will be lower than they are now in 97 percent of 381 metro areas by the third quarter of 2010.

The riskiest markets for falling home prices are California’s Inland Empire; the greater Miami, Fla., area; Lake Havasu City-Kingman, Ariz.; and the Cape Coral-Fort Myers, Fla., areas.

The cities with the lowest risk of further declines include the Dallas-Fort Worth area, greater Houston and Pittsburgh.

Home prices showed signs of recovery in the third quarter of 2008, but with rising unemployment rates, home prices fell further in the fourth quarter, says PMI chief economist David Berson.

Source: The Wall Street Journal, Ruth Simon (01/13/09)