By Janna Herron
AP Real Estate Writer
NEW YORK (AP) -- Home prices edged up in just half of U.S. cities in the third quarter as the weak economy dulled buyer interest, a trade group said last week.
The National Association of Realtors said the median sales price for previously occupied homes rose compared with last year in 77 out of 155 metropolitan areas tracked in the July-to-September quarter. That compares with 100 out of 155 cities in the April-to-June quarter.
Eleven cities had double-digit price increases, with Burlington, Vt., and Elmira, N.Y., leading the way with price gains of 17.6 percent and 16.9 percent, respectively. The worst showing in the third quarter was Ocala, Fla., where the median home price dropped 20 percent to $82,200 from $102,700 a year ago.
The national median price in the third quarter was $177,900, down from $178,200 in the same quarter last year and up from $176,800 in the second quarter.
Most experts predict prices will sink further as high unemployment slows the economic recovery and as millions of foreclosures pour onto the market in the coming years.
In the near term, recent investigations into faulty paperwork could delay some foreclosure sales. Banks' foreclosure practices have come under heavy scrutiny after allegations surfaced in September that lenders used faulty paperwork in taking back homes. Major lenders temporarily halted some foreclosures while they reviewed their practices and attorney generals in all 50 states launched a joint investigation into the issue.
Sales of previously occupied homes dropped to a seasonally adjusted annual rate of 4.16 million in the third quarter, from 5.57 million in the second quarter and 5.28 million in the same period a year ago.
Sales in the second quarter were boosted by homebuying tax credits that expired at the end of April. Record low mortgage rates since spring haven't been enough to convince buyers to take the plunge.
Rates on fixed mortgages fell to their lowest levels in decades last week, Freddie Mac said, after the Federal Reserve announced a huge Treasury-buying program to help boost economic growth.
Regionally, the median home price in the Northeast rose 2.5 percent to $253,400 in the quarter from the year before even as sales activity dropped by 27 percent. In the Midwest, the median price slid 3.0 percent to $145,600 and home sales tumbled by more than a third from the previous year.
The South's median home price dipped almost 2 percent during the period to $157,000 as sales lagged the previous year by 22 percent. The median home price in the West slipped 0.4 percent to $224,800 in the third quarter from a year ago. Sales there dropped by 21 percent.
Published: Wed, Nov 17, 2010
