The majority of metropolitan areas experienced historically strong annual increases in median existing-home prices in second quarter 2005, according to the latest survey by the National Association of Realtors® (NAR).
The association’s second-quarter metro area home price report, covering changes in 149 metropolitan statistical areas, shows 67 areas with double-digit annual increases in median existing single-family home prices and seven areas posting generally modest price declines; none of the areas seeing declines had previously recorded rapid gains. NAR has expanded the number of metros covered in the report, and revised the definitions of metros due to changes in those areas over time.
The national median existing single-family home price was $208,500 in the second quarter, up 13.6 percent from the second quarter of 2004 when the median price was $183,500. The median is a typical market price where half of the homes sold for more and half sold for less. In all, 94 metro areas saw increases above the U.S. historic average of 6.4 percent. Since 1968, prices generally have risen 1-to-2 percentage points faster than the overall rate of inflation; the historic average price increase appears high because there was a period of high inflation in the U.S. during the 1970s and early 1980s.
David Lereah, NAR’s chief economist, says the price gains are unprecedented. “When you look at appreciation of home prices relative to the overall rate of inflation, these are the strongest increases on record,” he says. “The continuing shortages of housing inventory are driving the price gains.”
NAR President Al Mansell notes that housing remains a good investment. “Given the fact that the second quarter was a record for home sales, it’s clear that many people find it is an excellent time to buy a home, even with stiff competition from other buyers,” he says. “Americans view housing as a solid long-term investment, and they’re taking advantage of favorable conditions to improve their current lifestyle as well as their long term financial interests.”
According to the report many Florida Metropolitan areas made the top of the list. Including Cape Coral-Fort Myers, Palm Bay-Melbourne-Titusville, Orlando, Sarasota-Bradenton-Venice, and Miami-Ft. Lauderdale-Miami Beach.
© FLORIDA ASSOCIATION OF REALTORS®
Posted by Donald Urschalitz P.A. at August 25, 2005 01:27 PM
