All metro areas showing home-price gains

ACCORDING TO THE NATIONAL ASSOCIATION of Realtors (NAR), Washington, D.C., home prices in the second quarter of 2003 increased in all metropolitan areas for which data is available compared with the

NAR's second-quarter metro area home-price report, covering changes in 126 metropolitan statistical areas, shows 40 areas with double-digit annual increases in median existing-home prices and no areas with price declines.

According to David Lereah, NAR's chief economist, this is the most exceptional home-price survey the association has ever reported. "Normally, even in very strong sales markets, there are about a half-dozen metros somewhere in the country that, for one reason or another, have a temporary price decline," he said. "Not only is every market positive, but also a record number of metropolitan areas are experiencing doubledigit price gains."

The national median existing-home price was $168,900 during the second quarter, up 7.4 percent from second-quarter 2002 when the median price was $157,300. The median is a typical market price where half of the homes sold for more and half sold for less.

Lereah said price appreciation is expected to moderate. "With a modest, gradual rise in mortgage interest rates going into next year, home sales will slow a bit and help to bring the market closer to equilibrium between buyers and sellers," he said. "This will reduce pressure on home prices, and the rate of price increases should slow, but in most areas they'll still rise a little faster than historic norms."

The strongest increase was in Riverside-San Bernardino, California, with a median price of $212,600, up 23.5 percent from the second quarter of 2002. Next came the Providence, Rhode Island, area at $228,900, up 23.2 percent. Third was the Los Angeles-Long Beach, California, area, where the second-quarter median price of $337,200 was 20.6 percent higher than a year earlier.

Median second-quarter metro resale prices ranged from $87,300 in Beaumont-Port Arthur, Texas, to more than six times that amount in the San Francisco Bay area, where the median price was $560,200. The second most expensive area was Anaheim-Santa Ana, California, with a second-quarter median resale price of $471,700, followed by Boston at $409,100.

Other low-cost markets include Buffalo-Niagara Falls, New York, the second least-costly area at $90,400, and South Bend-Mishawaka, Indiana, with a secondquarter typical resale home price of $91,000.

Regionally, the strongest increase was in the Northeast, where the median resale price during the second quarter was $182,500, a rise of 13.6 percent from a year earlier. After Providence, the strongest increase in the region was in the Nassau-Suffolk, New York, area, where the typical resale price was $363,700, up 18.4 percent from a year ago; followed by Atlantic City, New Jersey, with a median price of $164,600, up 18.3 percent; and the New York City area at $350,900, up 15.5 percent. Eight other metros in the Northeast, including Philadelphia and Hartford, also show double-digit median price gains.

In the West, the median existinghome price of $233,200 was 8.6 percent above the second quarter of 2002. After Riverside-San Bernardino and Los Angeles-Long Beach, the highest increase in the region was in the Sacramento, California, area, with a median price of $243,600, up 20.1 percent from the second quarter of 2002. Anaheim-Santa Ana rose 14.7 percent, while Honolulu, with a second-quarter median price of $375,000, rose 13.6 percent from a year earlier. San Diego; Las Vegas; and Reno, Nevada, also experienced double-digit increases.

In the Midwest, the median resale home price of $140,800 during the second quarter was 6.0 percent higher than the same period in 2002. The strongest increase in the region was in the Topeka, Kansas, area, with a median price of $100,700, up 20.2 percent in the last year. The next highest increase was in Champaign-Urbana-Rantoul, Illinois, where the median price of $122,700 was 14.8 percent higher than the second quarter of 2002; followed by the DavenportMoline-Rock Island, Iowa, area, and Illinois at $107,200, up 14.3 percent. Four other Midwestern metros also experienced double-digit gains.

The second-quarter median existinghome price in the South was $157,400, up 5.9 percent from a year ago. The strongest increase in the region was in the Knoxville, Tennessee, area, where the second-quarter median price of $141,300 was up 18.7 percent from a year earlier. Next came Melbourne-Titusville-Palm Bay, Florida, at $130,100, up 16.5 percent; Daytona Beach, Florida, with a median of $122,800, an increase of 16.4 percent; and the Baltimore area at $204,200, up 16.1 percent. Nine other metro areas in the South, including Washington, D.C.; Fort Lauderdale-Hollywood-Pompano Beach, Florida; and Jacksonville, Florida, experienced double-digit price increases.