Home prices to keep falling, Moody's says

Now may be an attractive time to buy a house, with interest rates at historic lows and plenty of homes for sale in Hampton Roads.

But a national economic research firm has predicted that existing-home prices in Hampton Roads will drop nearly 18 percent between now and the second quarter of 2010.

Moody's Economy.com pinpointed the middle part of next year as the bottom for the local housing market, forecasting the median price will fall to $173,420 from $210,886.

Prices will continue to skid along the bottom for another year after that before picking back up in late 2011, the group said.

Local reaction to the forecast was mixed.

"It is possible that we will once again trail the remainder of the country... in terms of getting to the bottom," said James Koch, an economist at Old Dominion University, in an e-mail.

Koch, however, thought the decline won't be as severe as predicted by Moody's.

Others, such as Dorcas Helfant-Browning, chief executive of Coldwell Banker Professional, Realtors, said local housing prices already have hit bottom.

"But we're not going to see any dramatic increases," she said.