Home prices tumbled nationally by the sharpest annual rate ever in July, while the Valley and Las Vegas saw even steeper drops.
That's according to the Standard & Poor's/Case-Shiller 20-city housing index, which fell a record 16.3 percent in July from the same month last year, the largest drop since its inception in 2000. The 10-city index fell 17.5 percent, the biggest drop in its 21-year history.
Las Vegas had the steepest drop, down 29.9 percent, while the Valley was down 29.3 percent.
Prices in the 20-city index have fallen nearly 20 percent since peaking in July 2006, while the 10-city index has fallen more than 21 percent since peaking in June 2006.
No city saw annual price gains in July, for the fourth straight month.
"In 2005, (Valley) home prices were growing at rates of almost 50 percent per year. A $200,000 house was $300,000 next year," said Maureen Maitland, vice president with index analysis at Standard & Poor's.
"When people finally got sticker shock and realized that perhaps things were overvalued, and then you add to that the inventory overhang, there's a lot of supply out there. There was just a lot more factors that were pushing down the home prices (in the Valley)."
It's important to remember that indexes don't reflect every neighborhood and subdivision in the Valley, said Jay Thompson, a broker with Thompson Realty in Gilbert.
"Most of the Valley has seen declining prices, but there are some places where it has leveled off," he said. "There are certain little pockets of neighborhoods where it's hard to find a house, it's almost a seller's market. So people need to understand ... that real estate is very local, all the way down to the specific subdivision."
This is the first time that housing prices across the nation are falling, which makes the outcome much less predictable, Maitland said. Usually, home price declines occur regionally while prices remain steady nationally, she said.
The fight over the congressional bailout plan and resulting market volatility no doubt are creating additional anxiety about financing, Thompson said.
"I think people just need to try to read up and understand what's going on, and talk to their loan officer if they're interested in getting a mortgage, because there's no question that those mortgage products are still out there," he said.