Property prices increased in most metro areas in the US in the second quarter of 2019
Most metro areas in the United States saw price gains while the supply of homes for sale grew only marginally in the second quarter of 2019, according to the latest research from realtors.
Single family median home prices increased year on year in 91% of measured markets in the second quarter, with 162 of 178 metropolitan statistical areas showing sales price gains, according to the report from the National Association of Realtors. That is up from the 86% share in the first quarter of 2019.
The national median existing single family home price in the second quarter was $279,600, up 4.3% from the second quarter of 2018 when it was $268,000.
The metro areas where single family median home prices declined included the high cost areas of San Jose-Sunnyvale-Santa Clara in California with a fall of 5.3%, San Francisco-Oakland-Hayward, also in California, down 1.9%, and Urban Honolulu in Hawaii down 1.2%.
Ten metro areas experienced double digit increases, including the moderate cost metro areas of Boise City-Nampa in Idaho, Abilene in Texas, Columbia in Montana, Burlington-South Burlington in Vermont, and Atlantic City-Hammonton in New Jersey.
Lawrence Yun, NAR chief economist, said home builders must bring more homes to the market. ‘New home construction is greatly needed, however home construction fell in the first half of the year,’ he pointed out.
‘This leads to continuing tight inventory conditions, especially at more affordable price points. Home prices are mildly reaccelerating as a result,’ he added.
The data also shows that 93 out of 178 metro markets under study have price growth of 5% or better. ‘Housing unaffordability will hinder sales irrespective of the local job market conditions. This is evident in the very expensive markets as home prices are either topping off or slightly falling,’ Yun explained.
At the end of 2019’s second quarter some 1.93 million existing homes were available for sale, which is about equal to the total inventory at the end of 2018’s second quarter. Average supply during the second quarter of 2019 was 4.4 months, up from 4.3 months in the second quarter of 2018.
Yun pointed out that housing sales should improve, but cautions of greater economic uncertainty. ‘The exceptionally low mortgage rates will help with housing affordability over the short run. But if the low interest rates are due to weakening economic confidence, as reflected from a correction in the stock market, then the low rates will not help with job growth and will eventually hinder home buying and home construction,’ he concluded.