The median price for single family homes declined a record 15.6 per cent to $174,100 in the second quarter from the year before, as foreclosures brought budget-conscious buyers back into the housing market, the National Association of Realtors reported on Wednesday.
Home prices had increased almost 62 per cent between the first quarter of 2000 and the third quarter of 2005, according to the index. They have since fallen almost 26 per cent. Prices ticked up 4 per cent from the first quarter.
The west of the US was particularly hard hit, falling 26.6 per cent. Eleven of the 155 metropolitan areas fell more than 30 per cent, mostly concentrated in Florida, California and Nevada. Florida’s Cape Coral and Fort Myers metropolitan area were hardest hit, falling 52.8 per cent.
But the data comes after signs that the market may be stabilising. The 20-city Case-Shiller index, another closely watched indicator, last month showed its first increase in three years. The monthly NAR index, also released late last month, showed a 4 per cent month-on-month increase in June.
The accelerated price decline comes as buyers re-enter the market, often looking for deals on foreclosed homes. Total existing-home sales for the quarter picked up 3.8 per cent to a seasonally adjusted rate of 4.76m from the first quarter, but were down 2.9 per cent on the year. About 36 per cent of transactions in the second quarter were distressed sales, either foreclosures or short sales.
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