Northeast Grows Slightly Stronger in Fourth Quarter
The majority of metropolitan areas experienced steady but slightly stronger price growth in the fourth quarter of 2014, behind a decline in housing supply and an uptick in demand fueled by lower interest rates and a stronger job market, according to the latest quarterly report by the National Association of Realtors®.
The median existing single-family home price increased in 86 percent of measured markets, with 150 out of 1751 metropolitan statistical areas2 (MSAs) showing gains based on closings in the fourth quarter compared with the fourth quarter of 2013. Twenty-four areas (14 percent) recorded lower median prices from a year earlier.
There were more rising markets in the fourth quarter compared to the third quarter, when price increases were recorded in 73 percent of metro areas. Twenty-four areas in the fourth quarter (14 percent) had double-digit increases – a rise from 16 metro areas in the third quarter of 2014. Forty-two metro areas (26 percent) experienced double-digit increases in the fourth quarter of 2013.
Lawrence Yun, NAR chief economist, says improved sales activity compared to a year ago and tightening supply contributed to faster price appreciation in the final quarter of 2014. “Home prices in metro areas throughout the country continue to show solid price growth, up 25 percent over the past three years on average,” he said. “This is good news for current homeowners but remains a challenge for buyers who are seeing home prices continue to outpace their wages. Low interest rates helped preserve affordability last quarter, but it’ll take stronger income gains and more housing supply to help meet the pent-up demand for buying.”
Total existing-home sales in the Northeast rose 2.5 percent in the fourth quarter and are 4.1 percent below the fourth quarter of 2013. The median existing single-family home price in the Northeast was $246,300 in the fourth quarter, up 2.2 percent from a year ago.
source: “Home-Price Growth Slightly Accelerates in Fourth Quarter of 2014” NAR, (2015)