Hot housing markets
Hot housing markets
The latest numbers: Double-digit gains in 62 markets; Florida steps into the limelight.
February 15, 2005: 11:40 AM EST
By Sarah Max, CNN/Money senior writer
NEW YORK (CNN/Money) – Anyone looking for signs of weakness in the real estate market will be disappointed, according to the National Association of Realtors.
A record number of metropolitan areas – 62 out of 129 – experienced double-digit home-price gains between the fourth quarter of 2003 and the fourth quarter of 2004. The previous record was set during the second quarter when 49 metros were up 10 percent or more. (Table: See all the markets.)
The national median price for existing homes in the fourth quarter was $187,500, according to the NAR, an 8.8 percent increase from last year.
"With more buyers than sellers nationally, what we're seeing is a natural pressure on home prices as buyers compete to bid on available properties," said NAR chief economist David Lereah. "Fortunately, the historically low cost of debt service on a home purchase means that we have a comfortable buffer in most of the country because the typical family can afford to buy a home well above the median price."
Lereah's new book, "Are You Missing the Real Estate Boom?" (Currency/Doubleday), is scheduled to be released in March and predicts that real estate investments will climb through the end of the decade.
Las Vegas topped the list as the market with the greatest appreciation over the past 12 months, with a 47.3 percent gain. In San Bernardino and Riverside counties in California, prices were up 34.7 percent.
But Florida is stealing some of the limelight from California. Six of the top 10 markets for the fourth quarter were in the Sunshine State. Prices in West Palm Beach and Boca Raton increased 34 percent over the past year, while in Bradenton they were up 32 percent.
"The Boomers are in their peak earning years, buying second homes and retiring to Florida," said Lereah. "We're seeing a lot of development and a lot of building but demand is greater than supply."
As for California, "appreciation there is still healthy," said Lereah. "Realtors there say that there is still very little supply of homes for sale."
Though prices remain high, houses in Southern California aren't selling quite as fast as they used to. "Sales are strong, but not at a peak, and price increases are slowing down, especially in the markets that took off first back in 1998 and 1999," said Marshall Prentice, DataQuick president in a release yesterday.
Not everyone got rich on real estate in 2004. Homeowners in Atlanta, Chicago and Denver saw average gains of 3 percent, 2.7 percent and 1.7 percent respectively. Prices in four cities, including Austin and Indianapolis, fell during the past year.
"In the handful of areas with price declines, none had previously experienced rapid price growth," said Lereah. "In fact, they were all lower-cost areas experiencing one or both of the conditions necessary for temporary price softness -- local economic weakness, mainly in jobs, or a large supply of homes available in the local market."
(Table: See all the markets.)
Hot housing markets
The latest numbers: Double-digit gains in 62 markets; Florida steps into the limelight.
February 15, 2005: 11:40 AM EST
By Sarah Max, CNN/Money senior writer
NEW YORK (CNN/Money) – Anyone looking for signs of weakness in the real estate market will be disappointed, according to the National Association of Realtors.
A record number of metropolitan areas – 62 out of 129 – experienced double-digit home-price gains between the fourth quarter of 2003 and the fourth quarter of 2004. The previous record was set during the second quarter when 49 metros were up 10 percent or more. (Table: See all the markets.)
The national median price for existing homes in the fourth quarter was $187,500, according to the NAR, an 8.8 percent increase from last year.
"With more buyers than sellers nationally, what we're seeing is a natural pressure on home prices as buyers compete to bid on available properties," said NAR chief economist David Lereah. "Fortunately, the historically low cost of debt service on a home purchase means that we have a comfortable buffer in most of the country because the typical family can afford to buy a home well above the median price."
Lereah's new book, "Are You Missing the Real Estate Boom?" (Currency/Doubleday), is scheduled to be released in March and predicts that real estate investments will climb through the end of the decade.
Las Vegas topped the list as the market with the greatest appreciation over the past 12 months, with a 47.3 percent gain. In San Bernardino and Riverside counties in California, prices were up 34.7 percent.
But Florida is stealing some of the limelight from California. Six of the top 10 markets for the fourth quarter were in the Sunshine State. Prices in West Palm Beach and Boca Raton increased 34 percent over the past year, while in Bradenton they were up 32 percent.
"The Boomers are in their peak earning years, buying second homes and retiring to Florida," said Lereah. "We're seeing a lot of development and a lot of building but demand is greater than supply."
As for California, "appreciation there is still healthy," said Lereah. "Realtors there say that there is still very little supply of homes for sale."
Though prices remain high, houses in Southern California aren't selling quite as fast as they used to. "Sales are strong, but not at a peak, and price increases are slowing down, especially in the markets that took off first back in 1998 and 1999," said Marshall Prentice, DataQuick president in a release yesterday.
Not everyone got rich on real estate in 2004. Homeowners in Atlanta, Chicago and Denver saw average gains of 3 percent, 2.7 percent and 1.7 percent respectively. Prices in four cities, including Austin and Indianapolis, fell during the past year.
"In the handful of areas with price declines, none had previously experienced rapid price growth," said Lereah. "In fact, they were all lower-cost areas experiencing one or both of the conditions necessary for temporary price softness -- local economic weakness, mainly in jobs, or a large supply of homes available in the local market."
(Table: See all the markets.)
