National Association of Realtors® Reports 2 Qtr Home Sales
Nationally, median prices are down slightly, number of homes sold steady
Palm Coast, FL – August 10, 2011 – The National Association of Realtors® issued its summary of second quarter 2011 home sales. The organization reports that median selling prices were down. Only twenty-seven percent of metro areas reported higher median selling prices. The national median stood at $171,900. This compares to the Flagler County second quarter median selling price of $120,000. At the same time, Florida Realtors® report the overall second quarter Florida median home selling price was $134,600. GoToby.com will publish its next Newsletter with in-depth analysis of the Palm Coast and Flagler County market tomorrow. Remember, all real estate markets are local.
The national and state reports appear below:
U.S. Home Sales
Median existing-home prices declined modestly in the second quarter with 27 percent of metropolitan areas experiencing price gains from a year ago, while state home sales declined from the second quarter of 2010, according to the latest quarterly report by the National Association of Realtors®.The median existing single-family home price rose in 41 out of 151 metropolitan statistical areas1 (MSAs) in the second quarter from the same period in 2010, including four with double-digit increases; one was unchanged and 109 areas showed price declines. In the first quarter, 34 metro areas had posted gains from a year earlier.
Lawrence Yun, NAR chief economist, said home prices have been moderating. “Median home prices have been moving up and down in a relatively narrow range in many markets, which shows a stabilization trend,” he said. “Markets showing consistent price stability or increases are those with solid labor market conditions, such as in Washington, D.C.; San Antonio; or Fargo, N.D.”
Yun noted the median price measurement reflects the types of homes that are selling during the quarter and can be misleading at times. “The level of foreclosures, which can artificially depress median prices, can vary notably in given markets. The annual price gauge smoothes out the quarterly swings and has shown fairly stable price trends in most markets.”
He added the housing market should be stronger. “With home prices in a broad trough and historically low mortgage interest rates, high housing affordability conditions and rising rents could stimulate a more rapid sales recovery if banks get back into the business of lending to more creditworthy borrowers,” Yun said.
NAR’s Housing Affordability Index stood at 176.6 in the second quarter, the third highest on record after the first quarter of 2011 and fourth quarter of 2010. The index measures the relationship between median home price, median family income and mortgage interest rates; the higher the index, the greater household purchasing power. Recordkeeping began in 1970.
The national median existing single-family home price was $171,900 in the second quarter, down 2.8 percent from $176,800 in the second quarter of 2010. The median is where half sold for more and half sold for less. Distressed homes,2 typically sold at a discount of about 20 percent, accounted for 33 percent of second quarter sales, down from 39 percent in the first quarter; they were 32 percent a year earlier.
Total state existing-home sales, including single-family and condo, declined 5.4 percent to a seasonally adjusted annual rate3 of 4.86 million in the second quarter from 5.14 million in the first quarter, and were 12.7 percent below a 5.57 million pace during the second quarter of 2010. June 2010 was the closing deadline for the home buyer tax credit.
NAR President Ron Phipps, broker-president of Phipps Realty in Warwick, R.I., said the key to healthy housing is credit access. “It’s frustrating for many creditworthy potential home buyers to realize that when they’re ready to make a move, banks remain risk averse,” he said. “People with good jobs, long-term plans and who are willing to stay well within their means deserve an opportunity to realize their American dream of home ownership. When banks return to normal and safe but sensible lending standards, housing will be able to contribute its traditional share to economic growth.”
Yun clarified the point on economic growth. “The direction of the economy will be determined principally by the housing market recovery, and indications now are pointing toward only a modest recovery,” he said.
The share of all-cash home purchases was 30 percent in the second quarter, up from 25 percent in the second quarter of 2010. Investors, who make up the bulk of cash purchasers, accounted for 19 percent of second quarter transactions, up from 14 percent a year ago.
First-time buyers purchased 35 percent of homes, down from 46 percent in the second quarter of 2010. Repeat buyers accounted for a 56 percent market share in the second quarter, up from 40 percent a year earlier.
In the condo sector, metro area condominium and cooperative prices – covering changes in 54 metro areas – showed the national median existing-condo price was $169,200 in the second quarter, which is 3.5 percent below the second quarter of 2010. Fourteen metros showed increases in the median condo price from a year ago and 40 areas had declines.
Regionally, the median existing single-family home price in the Northeast rose 2.0 percent to $245,600 in the second quarter from a year ago. Existing-home sales in the Northeast declined 4.6 percent in the second quarter to a level of 763,000 and are 19.9 percent below the second quarter of 2010.
The median existing single-family home price in the Midwest fell 5.4 percent to $139,800 in the second quarter from the same period in 2010. Existing-home sales in the Midwest were down 3.1 percent in the second quarter to a pace of 1.05 million and are 18.3 percent below a year ago.
In the South, the median existing single-family home price declined 2.7 percent to $153,000 in the second quarter from a year earlier. Existing-home sales in the South fell 3.4 percent in the second quarter to an annual rate of 1.89 million and are 9.9 percent below the second quarter of 2010.
The median existing single-family home price in the West declined 3.1 percent to $218,000 in the second quarter from the second quarter of 2010. Existing-home sales in the West dropped 10.8 percent in the second quarter to a level of 1.16 million and are 6.2 percent below a year ago.
The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing 1.1 million members involved in all aspects of the residential and commercial real estate industries.
Florida Home Sales
Florida’s existing home and existing condo sales experienced an upswing in the second quarter of 2011 compared to the same period a year earlier, according to the latest housing statistics from Florida Realtors®. Existing home sales rose 1 percent in 2Q 2011 with a total of 52,421 homes sold statewide; during the same period the year before, a total of 51,973 homes changed hands according to Florida Realtors. Statewide sales of existing condos in the second quarter rose 14 percent compared to the year-ago sales figure.Statewide home and condo sales in the second quarter also increased over 1Q 2011’s sales figures, Florida Realtors’ records show. For 2Q 2011, statewide sales of existing homes rose 17.7 percent over the previous quarter’s activity; statewide existing condo sales increased 8.1 percent over the 1Q 2011 level.
The statewide existing-home median sales price was $134,600 for the three-month period; in 2Q 2010, it was $141,500 for a decrease of 5 percent. However, the 2Q 2011 statewide existing-home median sales price was 8.9 percent higher than the 1Q 2011 figure. The median is a typical market price where half the homes sold for more, half for less.
Looking at Florida’s housing sector in the second quarter of 2011, Dr. Sean Snaith, director of the University of Central Florida’s Institute for Economic Competitiveness, noted positive signs for a strengthening recovery.“Florida Realtors second quarter housing data shows that momentum in sales of both single family homes and condominiums continues to build, while median sales prices have also increased from first quarter to the second,” Snaith said.
“The fate of the housing market in Florida is tightly bound to that of the labor market,” he said. “They are like economic conjoined twins – improvement in one will invariably help the other. More jobs and lower unemployment will slow foreclosures as well as build the pool of potential buyers; both of these will work to help support prices. As single-family home and condo prices stabilize, the wealth effect of this will make owners more willing to spend, which in turn could boost hiring.”
Snaith added, “This may sound like a classic ‘chicken and the egg’ scenario, but as far as Florida’s economy is concerned, it doesn’t matter which comes first.”
In the year-to-year quarterly comparison for existing condo sales, 25,263 units sold statewide in the second quarter compared to 22,137 units in 2Q 2010 for a 14 percent gain. The statewide existing-condo median sales price was $94,700 in the second quarter; a year earlier, it was $96,400 for a 2 percent decrease. However, the 2Q 2011 statewide existing-condo median sales price was 17.3 percent higher than the 1Q 2011 figure.
Low mortgage rates were another favorable influence on the housing sector. According to Freddie Mac, the national commitment rate for a 30-year conventional fixed-rate mortgage averaged 4.66 percent in 2Q 2011; one year earlier, it averaged 4.91 percent.
Two charts showing statistics for Florida and its MSAs are attached. One chart compares the volume of existing, single-family home sales and median sales prices in the second quarter of 2011 to the second quarter of 2010, based on Realtor closed transactions from local Realtor boards/associations within the MSAs. The second chart compares the volume of existing condo sales and median sales prices in second quarter 2011 to second quarter 2010, based on Realtor closed transactions from local Realtor boards/associations within the MSAs.
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