The country's home prices fell 1.7% in the first quarter versus fourth quarter 2007, marking the largest quarterly price decline on record, according to statistics released Thursday by the Office of Federal Housing Enterprise Oversight (OFHEO). In addition, the one-year price decline of 3.1% between first quarter and 2007 and 2008 was the largest in the 17-year history of OFHEO's seasonally-adjusted purchase-only index.

OFHEO reported that prices in the first quarter fell in 43 states. California and Nevada-both with declines of more than 8%-led the way, while six other states saw prices drop more than 3%.

According to OFHEO's all-transactions House Price Index, which measures home sales and appraisals for refinancing, home prices fell just 0.2% in the first quarter versus the fourth quarter and were flat over the one-year period.

Based on all-transactions index, California and Florida combined had 19 of the 20 worst performing markets during the one-year period (Las Vegas was the exception). Three California cities suffered the steepest price drops in that timeframe-Merced (-27.4%), Stockton (-21.5%) and Modesto (-21.0%).

The metropolitan areas with the largest price increases during that period were Houma-Bayou, La. (11.2%), Grand Junction, Colo. (9.1%) and Wenatchee, Wash. (8.0%).