Sales of existing-home rose in 49 states and Washington D.C. in the first quarter compared with the fourth quarter of 2010, the National Association of Realtors reported Tuesday. Prices, however, fell in more than 75% of metropolitan areas surveyed, including nearly all major markets except Dallas, Austin, San Antonio, Washington D.C., Boston and the certain northern and western New York surburbs.
Total state existing-home sales, including single-family and condo, rose 8.3% to a seasonally adjusted annual rate of 5.14 million from 4.75 million in the fourth quarter, 0.8% below the rate of 5.18 million recorded during the same period in 2010.
The national median existing single-family home price fell 4.6% to $158,700 from $166,400 in last year's first quarter. The price was dragged down by distressed properties, which comprised 39% of total sales, up from 36% a year earlier. Distressed homes typically sold at a discount of about 20%, the NAR said.
Metro area condo and coop prices in 53 metro areas fell 10.4% to $152,900, with 11 metros showing increases versus 41 with declines and one that remained flat.
Investors snapped up 21% of sold properties in the quarter, up from 18% in the prior-year quarter. First-time buyers accounted for 32% of home sales, down from 42% in the first quarter of 2010, when a tax credit was in place. Repeat buyers accounted for a 47% share, up from 40% a year earlier.
Regionally, sales the Northeast rose 0.8% in the quarter to an annual pace of 800,000, 7.3% below first quarter 2010, with a 5% drop in the median price to $234,100. The Midwest rose 7.9% to a pace of 1.09 million, 5% below a year earlier, with the median price down 5.3% to $124,400. The South gained 8.5% to 1.96 million, 2.8 percent higher than the first quarter of 2010, with prices off 0.6% from last year's quarter to $141,800. The West jumped 13.5% to 1.29 million, up 2.1% from last year, but the median price was down 4.7% to $197,400.
"The rising sales trend in nearly all states is a part of the healing process to clear off inventory," said Lawrence Yun, chief economist for the Realtor group. "Sales need to rise before prices can firm up."
Regarding prices, Yun said, "The biggest sales increase has been in the lower price ranges, which are popular with investors and cash buyers. The preponderance of sales activity at the lower end is bringing down the median price, so what we're seeing is the result of a change in the composition of home sales."
Homes sold for $100,000 or less in the quarter rose 8.9% from the prior-year period, putting pressure on the overall median. All-cash home purchases rose to 33% from 27% in the first quarter of 2010.
"The good news is foreclosures, which account for two-thirds of all distressed homes sold, are selling very quickly," said Ron Phipps, broker-president of Phipps Realty in Warwick, R.I. and NAR president."Short sales still take far too long to get lender approval, but it appears the inventory of distressed property is peaking and will be gradually declining next year. This means the market should slowly return to balance."