A climb in home sales throughout the United States amidst insufficient supply caused home prices to steadily rise in most metro areas during the second quarter of 2015.
The median existing single family home price increased in 93% of measured markets, with 163 out of 176 metropolitan statistical areas (MSAs) showing gains, according to the latest quarterly report from the National Association of Realtors.
Just 13 areas or 7% recorded lower median prices from a year earlier and the number of rising markets in the second quarter increased compared to the first quarter, when price gains were recorded in 85% of metro areas.
The data also shows that 34 metro areas or 19% experienced double digit increases but this was a decline from the 51 metro areas in the first quarter while 19 or 11% double digit increases in the second quarter of 2014.
Lawrence Yun, NAR chief economist, said that the housing market has shifted into a higher gear in recent months. ‘Steady rent increases, the slow rise in mortgage rates and stronger local job markets fuelled demand throughout most of the country this spring,’ he explained.
‘While this led to a boost in sales paces not seen since before the downturn, overall supply failed to keep up and pushed prices higher in a majority of metro areas. With home prices and rents continuing to rise and wages showing only modest growth, declining affordability remains a hurdle for renters considering homeownership, especially in higher priced markets,’ he added.
The national median existing single family home price in the second quarter was $229,400, up 8.2% from the second quarter of 2014 when it was $212,000. The median price during the first quarter of this year increased 7.1% from a year earlier.
The five most expensive housing markets in the second quarter were the San Jose, California metro area, where the median existing single family price was $980,000, followed by San Francisco at $841,600, Anaheim-Santa Ana, California at $685,700, Honolulu at $698,600, and San Diego at $547,800.
The five lowest cost metro areas in the second quarter were Cumberland where the median single family home price was $82,400, Youngstown-Warren-Boardman, Ohio, at $85,000, Rockford, Illinois, at $94,700, Decatur, Illinois at $96,000, and Elmira, New York at $98,300.
Total existing home sales, including single family and condo, increased 6.6% to a seasonally adjusted annual rate of 5.3 million in the second quarter from 4.97 million in the first quarter, and are 8.5% higher than the 4.89 million pace during the second quarter of 2014.
‘The ongoing rise in home values in recent years has greatly benefited homeowners by increasing their household wealth,’ said Yun. ‘In the meantime, inequality is growing in America because the downward trend in the home ownership rate means these equity gains are going to fewer households,’ he added.
At the end of the second quarter, there were 2.3 million existing homes available for sale, slightly above the 2.29 million homes for sale at the end of the second quarter in 2014. The average supply during the second quarter was 5.1 months, down from 5.5 months a year ago.
Metro area condominium and cooperative prices, covering changes in 61 metro areas, showed the national median existing condo price was $217,400 in the second quarter, up 3.1% from the second quarter of 2014 when it was $210,800. Some 50 metro areas, 82%, showed gains in their median condo price from a year ago while 11 areas had declines.
Rising home prices weighed on affordability in the second quarter compared to the second quarter of last year despite an uptick in the national family median income to $66,637. To purchase a single family home at the national median price, a buyer making a 5% down payment would need an income of $49,195, a 10% down payment would require an income of $46,605, and $41,427 would be needed for a 20% down payment.
A breakdown of the figures show that total existing home sales in the Northeast increased 10.3% in the second quarter and are 8.6% above the second quarter of 2014. The median existing single family home price in the Northeast was $269,300 in the second quarter, up 5.2% from a year ago.
In the Midwest, existing home sales jumped 13.4% in the second quarter and are 12.7% higher than a year ago. The median existing single family home price in the Midwest increased 8.7% to $182,000 in the second quarter from the same quarter a year ago.
Existing home sales in the South fell rose 1.1% in the second quarter and are 6.3% above the second quarter of 2014. The median existing single family home price in the South was $202,900 in the second quarter, 8.7% above a year earlier.
In the West, existing home sales climbed 8.1% in the second quarter and are 8.1% above a year ago. The median existing single family home price in the West increased 9.6% to $325,200 in the second quarter from the second quarter of 2014.
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Source: Property News Spain