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Regional Spikes In
Housing Prices
A growing number of metropolitan areas
showed double-digit annual increases in median existing-home prices in the
first quarter, with an upward trend in overall price appreciation, according
to the latest survey by National Association of Realtors®.
The association’s first-quarter metro
area home price report, covering changes in 136 metropolitan statistical
areas,* shows a record of 66 areas with double-digit annual increases in
median existing single-family home prices and only six areas posting modest
price declines. The previous record was 62 metros showing double-digit price
appreciation in the fourth quarter of 2004.
The national median existing single-family
home price was $188,800 in the first quarter, up 9.7 percent from the first
quarter of 2004 when the median price was $172,100. The median is a typical
market price where half of the homes sold for more and half sold for less.
In the fourth quarter of 2004, the national annual rate of home-price
appreciation was 8.8 percent.
David Lereah, NAR’s chief economist,
points to the tight supply of homes available for sale. “We simply don’t
have enough homes on the market to meet demand,” he said. “Low mortgage
interest rates are drawing new households into the market, but some are
disappointed by their inability to find a home that meets their needs. We
think the supply situation may improve next year when interest rates are
expected to be higher – that should result in a lessening of demand and
cooler price appreciation.”
Three Florida metros led the nation in
price growth. The strongest price increase was in Bradenton, where the first
quarter price of $275,100 rose 45.6 percent from a year earlier. Next was
Sarasota, at $326,300, up 36.0 percent from the first quarter of 2004. Third
was the West Palm Beach-Boca Raton-Delray Beach area, with a first quarter
median price of $362,800, up 35.9 percent in the last year.
NAR President Al Mansell, CEO of Coldwell
Banker Residential Brokerage in Salt Lake City, said buyers need to do their
homework. “If home buyers find themselves in a market where price-bidding
is common, they need to have a handle on comparable market values and avoid
the temptation to take shortcuts,” he said. “It’s especially important
to understand loan terms – a real estate professional can help you to
avoid riskier products, in addition to walking you through the transaction
process.”
In the small number of areas with price
declines, none had previously experienced rapid price growth. Generally,
these are lower-cost markets experiencing one or both of the conditions
necessary for price softness – local economic weakness, mainly in jobs, or
a large supply of homes available in the local market; typically, these are
temporary in nature.
Median first-quarter metro area resale
prices ranged from $82,400 in Youngstown-Warren, Ohio, to more than eight
times that amount in the San Francisco Bay area where the median price was
$689,200. The second most expensive area in the United States was
Anaheim-Santa Ana (Orange Co., Calif.) at $656,900, followed by San Diego at
$584,100.
Other low-cost markets include
Waterloo-Cedar Falls, Iowa, the second least-costly area, at $86,500, and
Beaumont-Port Arthur, Texas, with a first-quarter typical resale home price
of $90,000.
Regionally, the strongest increase was in
the West where the median existing single-family home price was $282,900
during the first quarter, up 16.9 percent from a year ago. The strongest
increase in the region was in Riverside-San Bernardino, Calif., where the
median price of $343,400 rose 36.2 percent from a year earlier, followed by
the Las Vegas area, at $291,000, up 29.4 percent, and Sacramento, at
$352,900, up 26.9 percent from the first quarter of 2004. Fourteen other
Western metro areas also experienced double-digit annual price gains
including Honolulu, Phoenix, Los Angeles, San Diego, San Francisco,
Anaheim-Santa Ana and Seattle.
In the Northeast, the median resale price
during the first quarter was $245,700, rising 14.0 percent from a year
earlier. The strongest increase in the region was in the Atlantic City,
N.J., area, at $217,400, up 23.2 percent from the first quarter of 2004,
followed by Monmouth-Ocean, N.J., with a median price of $358,500, up 20.3
percent, and the Middlesex-Somerset-Hunterdon area of New Jersey, at
$381,400, up 18.2 percent. Twelve other Northeastern metros had double-digit
price gains including Bergen-Passaic, N.J.; the New York City area; the
Albany-Schenectady-Troy area of New York; Nassau-Suffolk, N.Y.; Hartford,
Conn.; and Boston.
In the Midwest, the first-quarter median
existing-home price of $148,800 increased 7.8 percent from the same period
in 2004. The strongest increase in the Midwest was in Springfield, Mo.,
where the median price of $126,400 was 15.4 percent higher than the first
quarter of 2004. Next came Rockford, Ill., at $129,300 in the first quarter,
up 14.0 percent, and the Champaign-Urbana-Rantoul area of Illinois, at
$120,700, up 12.9 percent in the last year. Wichita, Kansas; Aurora-Elgin,
Ill.; South Bend-Mishawaka, Ind.; Springfield, Ill.; and Green Bay, Wis.,
also had double-digit gains.
In the South, the typical existing
single-family home price rose 6.6 percent to a median of $166,600 in the
first quarter from a year earlier. After the Bradenton, Fla., area,
Sarasota, Fla., and the West Palm Beach-Boca Raton-Delray Beach area, the
strongest increase in the South was in the Orlando area, at $194,400, up
28.7 percent from the first quarter of 2004. Next was Miami-Hialeah, at
$315,700, up 28.4 percent, and Ocala, Fla., where the first quarter median
price of $122,200 was 27.0 percent higher than a year ago. Eighteen other
Southern metro areas experienced double-digit increases in their median
price including the Ft. Myers-Cape Coral-Punta Gorda area of Florida; the
Washington, D.C., area; Norfolk-Virginia Beach-Newport News, Va.;
Richmond-Petersburg, Va.; and Tampa-St. Petersburg-Clearwater.
Source: National Association
of Realtors |
