I almost said good news, but I think better is more appropriate.
FHFA released their latest quarterly home price index for U.S. metropolitan areas today. The index is imperfect, but the best home price indices like Case-Schiller and First American CoreLogic are only available for large metro areas. Thus, we track FHFA closely for the Valley.
For the first time in years, Valley Metro Areas have dropped off the list of metro areas with the largest 1-year decline in home values. That list is now entirely Florida, Nevada and Arizona. (Unfortunately, Valley Metro Areas Merced, Stockton and Modesto still top the 5 year price decline rankings - although other areas are rapidly closing the gap.)
In fact, Fresno, Merced, Modesto and Stockton all registered price increases between the 3rd and 4th quarter of 2009, for the 1st consistent quarterly gains that I can remember. Merced's gain was particularly large, but may just be a correction from last quarters unusually large decline.
Sacramento, Yuba City, Vallejo all registered quarterly declines.
Over the 5-year period, Merced/Modesto/Stockton are down about 40%, Sacramento is down 25%, and Fresno/Bakersfield is down about 20%.
The FHFA price declines are not as large as registered by median prices, zillow and others, and the FHFA index also did not rise as much as other indices during the boom. I suspect that is because the FHFA index includes appraisals in its database, and also only includes FAnnie/Freddie financed transactions which I think would have definitely resulted in underestimating the price-run up during the boom. I am using this index to help identify a bottom in current depreciation, and to compare current prices to times long before the sub-prime wave, 2000 and the 1990s.