Friday, February 16, 2007

NAR Hitting Bottom

The National Association of Realtors (NAR) yesterday released the results of homes sales/prices for the fourth quarter of 2006 in a release entitled “Fourth Quarter Metro Home Prices & State Sales Likely Have Hit Bottom”.

Within the lengthy release NAR highlights the many instances of quarterly price increases such as Indiana and Arkansas where home sales rose well over 10% compared with the fourth quarter a year earlier.

The release goes on to note that 71 Metropolitan Statistical Areas (MSA) showed solid price gains as well as recapping the average price increases seen in the last five year period for some of the nations hottest residential real estate markets.

As NAR President Pat Vredevoogd Combs puts it “Since the typical owner stays in a home for six years, it’s more useful to look at the five-year comparison for metro area home prices – most of them are seeing strong gains,” she said. The median five-year price gain is 41.8 percent.

The release wraps up by detailing the strongest metro areas of each major regional market citing areas from Pittsfield Massachusetts to Rockford Illinois.

Overall, the report reads fairly positive, that is, until you delve a little deeper into the data posted at NARs other quarterly metropolitan results page.

What NAR left out of the public release was that Q4 2006 showed 40 states with declining single family home sales with 19 declining 15% or more and 7 declining over 20%.

The hardest hit states continue to be Nevada (-36.1%) Florida (-30.8%) Arizona (-26.9%) Virginia (-26.2%) Washington DC (-22.2%) California (-21.3%) and Maryland (-20.8%) with New Jersey (-19.9%) and West Virginia (-19.5%) bordering on near 20% declines.

Furthermore, 25 states and DC are now experiencing double digit sales declines.

As for prices, NAR only examined 149 of the overall 379 MSAs finding that nearly half (73) of the areas had seen price declines.


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