Prices of single-family homes fell in the second quarter, but at a slower rate than in the previous three-month period, an economic analysis company said Thursday.

The median price of a U.S. home slipped at an annual rate of 5.3 percent in the second quarter, compared with a 6.6 percent decline in the first quarter of this year, according to the House Prices in America study by Global Insight Inc.

The most severe declines were in California, Florida and Michigan, representing 43 of the 50 worst performing metropolitan areas. Other cities in the bottom 50 include Las Vegas, Phoenix and Washington, D.C.

Meanwhile, just six housing markets were overpriced by 35 percent or more, down from 51 in 2005, Global Insight said. This “extreme overvaluation” is limited to Hawaii, Washington, Oregon and Utah, the study said.

Weak demand, rising foreclosures and fewer sales of high-priced homes have hurt prices in the sagging housing market. But the slowdown in price declines and the amount of extremely overvalued markets are signs that the housing “bubble” has burst, the company said in a news release.

Still, real estate markets are not ready to recover, and there remains a glut of unsold homes on the market – a situation made worse by foreclosures, the company said.

The study examines 330 real estate markets and bases its regional valuations on factors such as current and historic home prices, interest rates, household incomes and population density.

“Although the markets that were extremely overvalued two years ago are seeing expected price declines, other areas are seeing price declines due to weak economic conditions,” said Jeannine Cataldi, senior economist and manager of Global Insight's Regional Real Estate Service “The market has a lot of inventory to work through before prices will change course.”