Nearly 60 percent of metropolitan statistical areas (MSAs) surveyed by the National Association of Realtors® (NAR) showed an increase in housing prices during the first quarter of 2010 when compared to levels one year ago. Even more have seen what NAR called "healthy gains" in home sales.
The NAR survey covered 152 MSAs, 91 of which showed higher median single-family home prices during the first quarter of 2010 than during the same period in 2009. 29 of the increases were in the double digits. Prices continued to decline in 58 MSAs and were unchanged in three. In the fourth quarter of 2009, 67 areas showed increases while 123 areas saw prices decline.
Nationally the median price of an existing single-family home was $166,000, down 0.7 percent from a year earlier when the price was $167,300. Distressed homes which, NAR says are typically discounted by 15 percent in comparison to traditional sales, accounted for 36 percent of the sales in the January-March period.
Lawrence Yun, NAR chief economist, said of the national figure, "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. The tax credit has been very effective in drawing down excess inventory, with about one million additional sales resulting directly from the stimulus."
As many economists had predicted, the spike in home sales in the fourth quarter of 2009, which was driven largely by the first-time home buyer's tax credit, did not continue into the new year. Total existing-home sales, including single-family and condo sales, were at a seasonally adjusted annual rate of 5.14 million in the first quarter, down 14.0 percent from the fourth quarter figure of 5.97 million. First quarter sales were still 11.4 percent higher than the 4.61 million-units sold one year earlier.
"Year-ago comparisons are more meaningful in this report due to sales swings from the tax credit," Yun said.
NAR President Vicki Cox Golder, said buyers are looking at a home purchase in a new light. "Buyer confidence is back, and home buyers have long-term views. 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 - shelter that provides social benefits and is also a good long-term investment,"
Golder said even with some recent easing of mortgage credit, the housing market continues to be constrained by mortgage issues.
She said that one-third of NAR members responding to other surveys say that obtaining a mortgage has been a limiting factor for their customers, 11 percent report they have had a sales contract canceled and another 16 percent have had to renegotiate a contract because of a low appraisal.