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New home prices fall

WASHINGTON - Is this what a housing bust looks like? New home prices fell last month by the largest amount in 35 years and owners are being warned to brace for further declines, especially in formerly hot markets.

After years of increases, some buyers say prices are still out of their range.

The Commerce Department reported that the median price for a new home sold in September was $217,100, a decline of 9.7 percent from September 2005.

That was the lowest median home price in two years and the sharpest year-over-year decline since December 1970, providing dramatic evidence of the slowdown in the once-booming housing market.

The median price is the middle point, where half sell for more and half sell for less.

The price decline for new homes followed a report Wednesday that prices in the much bigger existing home sales market also dropped on a year-over-year basis in September by 2.5 percent, the largest decline in records going back nearly four decades.