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Home Prices, Sales on the Rise in Many Areas Across the Nation: NAR

The first quarter of 2010 proved to be one of improvement for many housing markets across the nation. According to the latest survey by the ""National Association of Realtors"":http://www.realtor.org/, a growing number of metropolitan areas experienced price gains from a year ago, and most states saw notable increases in home sales from last year.


In the first three months of this year, 91 out of 152 metropolitan statistical areas (MSAs) showed higher median existing single-family home prices compared to the same period in 2009, including 29 with double-digit increases. Of the remaining metros, three experienced no change in prices and 58 had price declines. That's a significant improvement from the fourth quarter of last year when just 67 areas showed annual price increases and 123 reported a drop in prices.

According to NAR, home prices varied from region to region. Posting the largest year-over-year gain, the median existing single-family home price in the Northeast rose 9 percent to $256,300 in the first quarter of this year compared to the same quarter in 2009. During the same period, the median price in the South inched up 1.1 percent to $148,200, and prices in the Midwest slipped 0.8 percent to $130,600. The largest price decline was seen in the West where the median home price fell 8.3 percent to $210,200.

Nationwide, the median existing single-family home price remained fairly flat at $166,100, down just 0.7 percent from $167,300 in the first quarter of 2009. NAR noted that distressed homes, which are typically discounted by 15 percent relative to traditional homes, accounted for 36 percent of first quarter sales, exerting downward pressure on the median price.


Lawrence Yun, NAR chief economist, said 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 in this metro area price report,"" he said. ""The tax credit has been very effective in drawing down excess inventory, with about 1 million additional sales resulting directly from the stimulus.""

The data for home sales was mixed. Total existing-home sales, including single-family homes and condos, were at a seasonally adjusted annual rate of 5.14 million in the first quarter, down 14 percent from a surge of 5.97 million in the fourth quarter of last year, which was driven by the initial tax credit, NAR said.

However, first quarter sales remained 11.4 percent above the 4.61 million-unit level from the same quarter last year. And according to Yun, ""Year-ago comparisons are more meaningful in this report due to the sales swing from the tax credit.""

On a year-over-year basis, existing-home sales increased in 44 states and the District of Columbia, and 31 of these states and the District of Columbia saw double-digit gains. Sales remained unchanged in two of the remaining states, while four reported a decline in sales.

Vicki Cox Golder, NAR president, credits the jump in year-over-year home sales to a change in market psychology. “Buyer confidence is back, and home buyers have long-term views,” she said. “The typical buyer plans to stay in their home for 10 years, so we’ve put the flipping mentality behind us and most people see housing for what it is â€" shelter that provides social benefits and is also a good long-term investment.”

Existing-home sales varied from region to region, but all showed the same trend of a decline in sales on a quarter-to-quarter basis and a rise in sales on an annual basis.

In the Northeast, home sales fell 17.7 percent from the fourth quarter of 2009 to the first quarter of 2010 but were 19.7 percent higher than a year ago, and sales in the Midwest dropped 17.3 percent from quarter to quarter but were 10.8 percent above a year earlier. In the South, home sales fell 14.6 percent from the previous quarter but were 10.7 percent higher than a year ago, and first quarter home sales in the West declined 6.8 percent from the fourth quarter of 2009 but were 8.3 percent higher than the first quarter of last year.

About Author: Brittany Dunn


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