Home Prices Rise in Nearly All Metro Areas in Second Quarter

WASHINGTON— A promising climb in home sales throughout the country amidst insufficient supply caused home prices to steadily rise in most metro areas during the second quarter, according to the latest quarterly report by the National Association of Realtors released on Aug. 11.

The median existing single-family home price increased in 93% of measured markets, with 163 out of 176 metropolitan statistical areas (MSAs) showing gains based on closings in the second quarter compared with the second quarter of 2014. Thirteen areas (7%) recorded lower median prices from a year earlier.

Lawrence Yun, NAR chief economist, said 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 fueled demand throughout most of the country this spring,” he said. “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.”

Yun added, “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.”

The national median existing single-family home price in the second quarter was $229,400, up 8.2% from the second quarter of 2014 ($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, CA, metro area, where the median existing single-family price was $980,000; San Francisco, $841,600; Anaheim-Santa Ana, CA, $685,700; Honolulu, $698,600; and San Diego, $547,800.

The five lowest-cost metro areas in the second quarter were Cumberland, MD, where the median single-family home price was $82,400; Youngstown-Warren-Boardman, OH, $85,000; Rockford, IL,  $94,700; Decatur, IL, $96,000; and Elmira, NY, $98,300.

Total existing-home sales in the Northeast increased 10.3% in the second quarter and were 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 were 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 were 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 were 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.

John Jordan
Editor, Real Estate In-Depth