The National Association of Realtors reported last Tuesday that single-family home prices dropped to $193,600, down by 7.7% in the first quarter compared to the same period last year when the median price was $212,600. The largest in almost three decades since the organization started reporting the prices.

Compared to the last quarter of 2007, prices fell 4.8%.

Lawrence Yun, the chief economist of NAR, pointed out liquidity problems pulling down high-priced markets. "These are highly unusual results because there were very few jumbo loan originations in the latest quarter" he said. So sales are much slower in high-cost areas" he added.

Median home prices declines, for existing single-family homes, were seen in two-thirds of the metropolitan areas surveyed in January-March period. 100 of 149 areas in the reported declines while 48 metropolitan areas saw prices increase and one reported no change.

Sales of Existing Homes

Existing homes sales plunged in 46 states. The largest percentage drop of 38.6 percent was recorded in Maryland during the first three months of this year compared with the same period in 2007.

Alaska, Illinois and New Jersey reported sales increases during the survey period.

Nationally, sales dropped by 22.2 percent during the first three months of the year compared to the same period last year.

The sharp decline in prices and sales were the latest indication of the problems facing the housing market, characterized as a market currently in a long drawn out slump that has pulled down home sales and home prices.