Median existing single-family home prices rose during the second quarter, but a lack of inventory is limiting buyer choices in certain markets, according to the National Association of Realtors.
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Median existing single-family home prices rose during the second quarter, but a lack of inventory is limiting buyer choices in certain markets, according to the National Association of Realtors.
The national median existing single-family home price reached $181,500 in the second quarter, up 7.3 percent from $169,100 in the second quarter of 2011. It was the strongest year-over-year increase since the first quarter of 2006, when the median price rose 9.4 percent. Still, even with the gain the current price is 20.1 percent below the record set in 2006.
The median price rose in 110 of 147 metro areas; three were unchanged and 34 saw price declines. In the first quarter of 2012 there were 74 areas showing price gains from a year earlier, while in the second quarter of 2011 only 41 metros were up.
"It's most encouraging to see a growing number of metro areas with rising median prices, which is improving the equity position of existing homeowners," said Lawrence Yun, NAR's chief economist. "Inventory has been trending down and home builders are still under-producing in relation to growing demand," he said. "Some of the improvement in prices is due to a smaller share of sales in low price ranges where inventory is tight."
Total existing-home sales, including single-family and condo sales, slipped 0.7 percent to a seasonally adjusted annual rate of 4.54 million in the second quarter from 4.57 million in the first quarter, but were 8.6 percent above the 4.18 million pace during the second quarter of 2011. At the end of the second quarter, there were 2.39 million existing homes available for sale, which is 24.4 percent below the close of the second quarter of 2011, when there were 3.16 million homes on the market.
"What we need now is additional inventory in the lower price ranges, so we hope banks will be releasing more foreclosure inventory into the market," said NAR President Moe Veissi. "With gains apparent in all of the price measures, banks also should have more confidence in expanding mortgage credit to home buyers using safe but sensible standards."
Regionally, existing-home sales in the Northeast slipped 0.6 percent in the second quarter; in the Midwest, sales rose 1.3 percent; sales in the South increased 1.3 percent; and sales in the West fell 5.3 percent.