Rate Watch
A growing number of metropolitan areas showed double-digit annual increases in median existing-home prices in the first quarter, with an upward trend in overall price appreciation, according to the latest survey by National Association of Realtors. The association’s first-quarter metro area home price report shows a record of 66 areas with double-digit annual increases in median existing single-family home prices and only six areas posting modest price declines. The national median existing single-family home price was $188,800 in the first quarter, up 9.7 percent from the first quarter of 2004 when the median price was $172,100. The median is a typical market price where half of the homes sold for more and half sold for less. In the fourth quarter of 2004, the national annual rate of home-price appreciation was 8.8 percent. David Lereah, NAR’s chief economist, points to the tight supply of homes available for sale. “We simply don’t have enough homes on the market to meet demand,” he said. “Low mortgage interest rates are drawing new households into the market, but some are disappointed by their inability to find a home that meets their needs. We think the supply situation may improve next year when interest rates are expected to be higher - that should result in a lessening of demand and cooler price appreciation.” Three Florida metros led the nation in price growth. The strongest price increase was in Bradenton, where the first quarter price of $275,100 rose 45.6 percent from a year earlier. Next was Sarasota, at $326,300, up 36.0 percent from the first quarter of 2004. Third was the West Palm Beach-Boca Raton-Delray Beach area, with a first quarter median price of $362,800, up 35.9 percent in the last year.
