NAR: Metro Prices Moderating

Posted by Orb Staff on November 11, 2009 No Comments
Categories : Residential Mortgage

Total state existing-home sales, including single-family and condo, increased 11.4% to a seasonally adjusted annual rate of 5.30 million units in the third quarter from 4.76 million units in the second quarter, according to a recent survey by the National Association of Realtors (NAR).

Sales increased from the second quarter in 45 states and the District of Columbia. Twenty-eight states and D.C. saw double-digit gains. Year-over-year sales were higher in 32 states and D.C.

The recently extended home-buyer tax credit was a significant factor, says Lawrence Yun, NAR chief economist.

"The buying conditions this year are the most favorable on record dating back to 1970, but the tax credit is allowing buyers to set aside any reservations about waiting for a better deal," he says.

During the third quarter, 123 out of 153 metropolitan statistical areas reported lower median existing single-family home prices in comparison with the third quarter of 2008, while 30 areas had price gains.

The national median existing single-family price was $177,900, which is 11.2% below the third quarter of 2008. Median home prices were weighed down by distressed sales, which accounted for 30% of third-quarter transactions.

"Foreclosures will continue to come on the market, but rising sales from the expanded tax credit should stabilize home prices by next spring and help to stem future foreclosures," Yun says.

The biggest sales gain between the second and third quarters was in North Dakota (42.3%), followed by Rhode Island (up 26.5%) and Pennsylvania (up 25.6%).

The largest single-family home price increase in the third quarter was in the Cumberland area of Maryland and West Virginia at $122,100 – up 19.2% from the third quarter of 2008. Next was the Davenport-Moline-Rock Island area of Iowa and Illinois, where the median price increased 14.3% to $115,600, followed by Oklahoma City, at $144,100 – up 9.1% from a year ago.

"The wide range of market performance and reversals around the country, ranging from double-digit gains to double-digit losses in both sales and prices, underscores just how local real estate truly is," Yun says. "The wide changes and mix of numbers also indicates a market in transition, hopefully to one that is becoming more balanced and stable."

SOURCE: National Association of Realtors

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