Ninety percent of American cities endured falling home prices in the first quarter as first – time home – buyers looking for bargains were the major influence in the market.
According to a statement made by the National Association of Realtors on Tuesday, May 11, 2009; median sales prices of existing homes declined 134 out of 152 comparative metropolitan areas compared with the same period a year ago. Prices did rise in 18 other undisclosed cities.
Foreclosures, “fixers”, REO’s, and other distressed properties contributed to about half of the market’s closed sales, even though sales did fall 3.2 percent from last year.
In a statement made by David Resler, chief economist at Nomura Securities, “I think we’re near a bottom, but we’re not there yet.” While prices could hit bottom as soon as this summer, he said they are likely to remain stable and start edging higher slowly.
All things being equal, the emerging signs of recovery in the housing market could be short – lived if employers continue to lay off workers en masse.
All but six states had falling sales figures – Nevada, California, Arizona, Florida, Virginia, and Minnesota – experienced sales jumps due to buyers being able to grab foreclosing or foreclosed properties at deep discounts. Sales more than doubled in Nevada, rose 81 percent in California and grew 50 percent in Arizona – signaling that the worst may be over for those distressed states.
Yet, the average sales price nationwide was $169,900, down 13.8 percent from a year ago. Obviously, half of the homes sold higher and half sold for less.
Fort Myers, Florida, showed the biggest drop of more than 50 percent. Following closely at 40 percent or more were the following municipalities: Saginaw, Michigan; Akron, Ohio; San Francisco and San Jose, California; Phoenix, Arizona; Sarasota, Florida; and Riverside, California.
On the other hand, the largest price gain, more than 21 percent, was in Cumberland, Maryland. Davenport, Iowa was the only other double – digit increase in value city with prices climbing nearly 14 percent.
Many of us in the real estate and lending industry, believe that once first – time home – buyers begin utilizing the $8,000 tax credit included in the Obama economic stimulus package; we should see a boost in sales, especially in the second half of the year. If this indeed occurs, then prices should stabilize in all areas.
