by Wannasiri Chompoopet, Manager, Existing-home Sales
The latest figures on metropolitan area home prices have been released by NAR and they show that a growing number of metropolitan areas are experiencing price gains from a year ago. At the same time, most states posted healthy gains in home sales from the first quarter of 2009.
In the first quarter of 2010, 91 out of 152 metropolitan statistical areas showed year-over-year increases in the median sales price of existing single-family homes. Twenty-nine of those metros registered double-digit increases. In the fourth quarter 67 areas reported gains. On a national basis, the median existing single-family home price was fairly flat at $166,100, down 0.7 percent from the first quarter 2009. Distressed homes, which typically are discounted by 15 percent relative to traditional homes, accounted for 36 percent of first quarter sales.
State Existing-Home Sales
Total state existing-home sales, including single-family and condos/co-ops, posted a seasonally adjusted annual rate of 5.14 million units in the first quarter. While that figure is down 14.0 percent from the 4th quarter 2009 surge of 5.97 million units (most likely driven by the initial home buyer tax credit program). first quarter sales were 11.4 percent above their 4.61 million-unit level in the first quarter of 2009. Year over year, resales rose from in 44 states and the District of Columbia; in fact, 31 states and the District experienced double-digit gains. NAR has been tracking state by state resales since 1981.
Idaho and Hawaii posted the largest increases in existing-home sales. Resales rose more than 100 percent in Idaho after having declined in the 4th quarter of last year. Existing-home sales in Hawaii increased more than 50 percent. Both states had experienced continued rising resales through the first three quarters of last year.
Median Home Prices
Metropolitan area median home prices for single-family homes ranged from $60,800 in Saginaw-Saginaw Township North area in MI to $621,200 in Honolulu HI. But the Saginaw metro posted the largest increase in the median sales price of home on a year over year basis, rising more than 100 percent from the $30,300 registered in the 1st quarter of last year. There were solid single-family price gains in a variety of metro areas, including three metros in Ohio (Akron, Dayton and Toledo) and two areas in Northern California (San Francisco-Oakland-Fremont and San Jose-Sunnyvale-Santa Clara). NAR began tracking metropolitan area median single-family home prices in 1979.
Figures on metropolitan area condo/co-op prices show that on a national basis, the existing-condo price was virtually unchanged – at $170,700 – in the 1st quarter of this year, down just 0.1 percent from a year ago. But 24 metros posted increases in the median price of condos/co-ops, compared with only 11 which showed increases in the fourth quarter. The largest increase was in Syracuse NY, rising 24.7 percent from the first quarter of 2009. The metro area condo price series dates back to 1989 and covers changes in 55 metro areas. Because there is a concentration of condos in high-cost metro areas, the national median condo price is generally higher than the median single-family price. In a given market area, condos typically cost less than single-family homes. As the reporting sample expands in the future, additional areas will be included in the condo price report.
“Figuring out” the figures
Stabilizing home prices are encouraging. This flattening in home prices is something we’ve been seeing in all of the home price measures lately, and quite clearly evident in this metro area price report. The tax credit has been very effective in drawing down excess inventory, with about one million additional sales resulting directly from the stimulus. The figures also point to a change in market psychology. The economy is improving; even recent jobs numbers were encouraging. That is helping to return confidence among buyers.
But there are still challenges. The housing market continues to held back from a full-fledged recovery because of mortgage issues. According to findings published in the new 2010 NAR Member Profile, one third of NAR members report that obtaining a mortgage is the most important factor limiting potential clients from purchasing a home. In addition, the REALTORS® Confidence Index (posted online on April 26 2010) reveals that 11 percent of REALTORS® had a contract canceled because an appraisal came in at less than the price negotiated between a buyer and seller. Another 16 percent report a contract had to be renegotiated because of a low appraisal. NAR leaders and staff will continue their discussions with about these other issues with government and industry leaders to insure that housing remains at the forefront of economic policy decisions.
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