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Home Prices Increase 6% in May

In the May 2014 Residential & Foreclosure Sales Report, RealtyTrac reported that U.S. properties sold at an estimated annual pace of 5.1 million in May. The pace of sold homes remained virtually unchanged from April, with a small increase of less than 1 percent from May 2013.

Including distressed and non-distressed properties, median home prices increased month-over-month by 6 percent to $180,000 in May, up 13 percent from the previous year. May's increase was the second consecutive month with a double-digit annual increase in U.S. home prices, as well as the biggest annual increase since home prices bottomed out in March 2012.

Distressed sales, which the company defines as properties in foreclosure or bank-owned, posted a median price of $120,000, 37 percent below the median price of non-distressed properties. Distressed sales coupled with short sales accounted for 14.3 percent of all U.S. residential sales in May—down from 15.6 percent of sales in April and down from 15.9 percent of all sales in May 2013.

"Distressed sales continue to represent a smaller share of the overall sales pie nationwide, helping to boost median home prices higher given that distressed sales tend to be in lower price ranges," said Daren Blomquist, VP at RealtyTrac. "When broken down by average price range, U.S. sales are clearly shifting away from the lower end."

He continued, "Properties selling below $200,000 represented 50 percent of all sales in May, but that was down from a 55 percent share a year ago. Meanwhile, the share of homes selling above $200,000 increased from a 45 percent a year ago to a 50 percent in May 2014."

RealtyTrac found that higher price ranges are seeing a growth and an increase in market share. Prices in every price range above $200,000 increased as a share of total sales, both monthly and yearly. Increases were "generally higher" in the higher price ranges, according to RealtyTrac.

"The share of home sales in the $200,000 to $300,000 price range increased 2 percent from the previous month and were up 6 percent from a year ago, but the share of home sales in all price ranges above $750,000 was up more than 20 percent from a year ago," the report found.

Furthermore, the share of home sales in price ranges below $200,000 saw a decline. Homes priced between $100,000 and $200,000 decreased by 5 percent, while homes in the $50,000 and $100,000 range decreased 13 percent. Homes priced below $50,000 decreased in market share by 22 percent.

The company found, "Home sales in the $100,000 to $200,000 price range accounted for one-third of all home sales in May—the largest percentage of any price range—but homes priced between $200,000 and $400,000 were close, accounting for nearly 32 percent of all sales for the month."

Short sales and distressed sales made up 14.3 percent of all sales in May, down from 15.6 percent in April and down from 15.9 percent of all sales in May 2013.

About Author: Colin Robins

Colin Robins is the online editor for DSNews.com. He holds a Bachelor of Arts from Texas A&M University and a Master of Arts from the University of Texas, Dallas. Additionally, he contributes to the MReport, DS News' sister site.
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