Home sales in fourth quarter 2005 fell 4.7 percent after scoring record highs in the previous three months, according to a report released in mid-February by the National Association of Realtors. But that’s not really dire news.
Sales of existing single-family homes and condominiums fell by some
340,000 to a seasonally adjusted annualized pace of 6.9 million,
the association reports. Still, many experts say there is plenty
of demand for housing even with mortgage rates inching upward. Overall,
last year stands to be the third best year on record for home sales
after posting all-time highs every year since 1999.
The same can be said for prices. The median price for a single-family
house rose 13.6 percent in the final quarter of 2005 compared to
a year earlier. But that only looks bad when compared to third quarter
2005, which showed a 15 percent increase from the third quarter
2004—the fastest appreciation recorded in 26 years.
The median price for an existing single-family home fared a bit
better, rising 14 percent to $213,000. The Realtors expect that
rate to slow to 7.8 percent in the first quarter 2006. It adds that
the average rate for a 30-year mortgage is expected to rise to 6.6
percent this year, the highest since 2001.
Of 145 metropolitan statistical areas across the country, in fourth
quarter 2005 the median single-family home price rose in 143 cities,
fell in six and remained the same in one. The biggest winner was
Phoenix/ Mesa, AZ, where the median price rose 49 percent to $268,400.
The biggest loser was South Bend, IN, where the median price fell
by 5.3 percent to $89,900.