The national median price of an existing single-family home in 2016's third quarter rose 5.2% from a year earlier to $240,900, according to the National Association of Realtors' (NAR) Metropolitan Median Area Prices and Affordability report released Thursday morning. This quarter's price is roughly on par with the second quarter of this year.

On a year-over-year basis, median existing single-family home prices rose in 87% of all measured markets (or 155 of 178 metropolitan statistical areas), while 22 metros, or 12%, saw prices drop from a year earlier.

"Mortgage rates around historical lows and solid local job creation created a winning formula for sustained home buying demand all summer long," said NAR chief economist Lawrence Yun. "Unfortunately for house hunters in several of the top job producing metro areas around the country, deficient supply levels limited their options and drove prices higher — especially in markets in the West and South."

Regionally, the West continued to report the largest increase in existing home prices (7.6% year-over-year) to a median price of $349,200 in this quarter. Close behind were the South and Midwest, with a 6.5% increase to $213,700, and a 5.6% gain to $191,200, respectively. Existing single-family homes in the Northeast rose 1.2% to $272,600 in this quarter.

The five most expensive existing home markets, mostly concentrated in the state of California, were:

  • San Jose, Calif., $1,000,000,
  • San Francisco, Calif., $835,400,
  • Urban Honolulu, Hawaii, $745,300,
  • Anaheim-Santa Ana, Calif., $740,100,
  • San Diego, Calif., $589,300.

The five most affordable existing home markets in this quarter were:

Metro area condominium and cooperative prices — covering changes in 59 metro areas — showed the national median existing-condo price was $225,100 in the third quarter, up 4.6% from the third quarter of 2015 ($215,200). Forty-one metro areas (69%) showed gains in their median condo price from a year ago; 17 areas had declines.

NAR President Tom Salomone, broker-owner of Real Estate II Inc. in Coral Springs, Florida, says the Federal Housing Administration's recently-announced rule change to lower the owner-occupancy requirement for approved condominium buildings from 50% to 35% under certain conditions is a step forward for prospective buyers considering a condo.

“With this lower owner-occupancy requirement, Realtors will have more options for their clients looking to purchase a condo with an FHA mortgage.,” Salomone said.

Read the full release from NAR >>