U.S. Single-Family Home Prices
Cooled in the First Quarter
by Benton Ives-Halperin
From Dow Jones Newswires
May 15, 2006
Prices for single-family homes in metropolitan areas cooled in the first quarter, but many metro regions are still showing double-digit annual gains, according to a survey released Monday by the National Association of Realtors.
In the first quarter of 2006, the median price for an existing single-family home was $217,900, a 10.3% increase over a year earlier. That pace of appreciation is down from the fourth quarter of 2005, when home prices rose 13.6% compared with the same period a year earlier.
A NAR economist said increased home inventories have reduced price pressures. "With the supply of homes picking up very nicely in many areas of the country, pressure is coming off of home prices," said David Lereah, NAR's chief economist.
Looking ahead, Lereah said he expected "most areas will be returning to normal rates of price growth in the single-digit range," when second quarter data is reported.
Still, while single-family prices are cooling nationally, some metro areas are still showing strong price growth.
Of the 149 metro areas surveyed by NAR, 60 regions had annual price growth in the double digits, while 16 showed price declines.
Several Florida regions showed surging prices over a year ago, with the Gainesville, Ocala and Orlando areas posting gains over 30%.
Condominium prices showed smaller prices gains than single-family homes in the first quarter, up 5.2% from a year earlier. The national median price for an existing condo was $224,100 in the first quarter.
Increasing inventories are also responsible for the slower price growth in the condo market, according to NAR President Thomas M. Stevens.
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