Remember all that speculation about when we'd reach the bottom of the housing market downturn? Well, we just made touchdown, according to an ASU study.
Valley home prices are dropping at a slower clip than they were earlier this year, according to the Arizona State University Center for Real Estate Theory and Practice at the W.P. Carey School of Business.
Translation: The worst is over.
The study found prices declined 33 percent between May 2008 and May 2009. That's down from a 35 percent year-over-year drop in April and a 37 percent drop in February and March.
The study showed preliminary estimates for June and July show annual drops of 31 percent and 29 percent, respectively, indicating the rate of home-price declines continues to slow.
ASU real estate professor Karl Guntermann cautioned the study doesn't indicate an imminent return to normal, nor is there any way to predict when the market will completely rebound.
While the market is turning around, he said prices have slipped for a record 27 months. Guntermann expects year-over-year prices to fall at a slower rate possibly through next year.
"I can see where the markets heading, but as far as how long it will take to get there (normalcy), I really don't know," he said. "I suspect prices will continue going down well into next year if not all of next year."
The study shows median home prices in the metro area bottomed out at $117,500 in April, and rose to $119,000 in May. That could increase to $120,000 in June.
The study looks at repeat sales, which reflect fluctuations in the value of a home over time.
One realtor said she has a hard time believing the numbers.
"I think we're being duped, quite frankly," said Pattie Haugland, a broker with Sonoran Fine Properties who handles properties in the East Valley.
Haugland said the banks are holding back on selling thousands of foreclosed homes, which is creating an artificial seller's market and slowing the decline in prices.
"I think that it is definitely premature for anybody to be making a statement saying that our values are stabling or increasing," she added.
She said if banks start dumping properties back on to the market, "we're going to see a big crash again."