Home prices rose in 87% of U.S. metro areas in third quarter

by 16 Nov 2015
Home prices climbed in 87 percent of U.S. metropolitan areas in the third quarter, with gains nationwide slowing to a healthier pace, the National Association of Realtors said.

The median price of an existing single-family home rose from a year earlier in 154 of the 178 areas measured, the group said in a report Thursday. In the second quarter, 93 percent of metropolitan areas had price increases.

Price growth in much of the country is being fueled by a combination of rising employment, low borrowing costs and a tight supply of properties on the market. Sales of existing homes rebounded in September to the second-highest level since February 2007, the Realtors group reported last month.

“The demand for buying picked up speed in many metro areas during the summer as more households entered the market, encouraged by favorable mortgage rates and improving local economies,” Lawrence Yun, the group’s chief economist, said in a statement. “While price growth still teetered near or above unhealthy levels in some markets, the good news is that there was some moderation despite the stronger pace of sales.”

In the third quarter, 21 regions had price increases of 10 percent or more, down from 34 areas in the second quarter, the Realtors said. Prices declined in 24 areas.

The biggest increases were in four Florida metros: the Tampa, St. Petersburg and Clearwater region; Punta Gorda; the Naples and Marco Island area; and Cape Coral and Fort Myers. Prices in the Tampa area jumped 20.7 percent from a year earlier, the largest increase in the U.S.

Cumberland, Maryland, had the biggest drop, at 11.6 percent. Prices fell 9.9 percent in Decatur, Alabama, 8.5 percent in Springfield, Illinois, and 7.7 percent in the Bridgeport, Stamford and Norwalk, Connecticut area.

The national median single-family home price was $229,000 in the third quarter, up 5.5 percent from a year earlier, the Realtors group said. In the second quarter, the median price was up 8.2 percent from a year earlier.


©2015 Bloomberg News
Prashant Gopal

COMMENTS

Poll

Is TILA-RESPA a good or bad thing long term?