A greater number of markets experienced double-digit annual price gains compared to the prior quarter, according to the National Association of Realtors’ (NAR) latest quarterly report.
According to NAR, 80 percent of the 185 tracked metro areas posted double-digit price gains, up from 70 percent in the first quarter of this year.
Nationally, the median single-family existing-home price surpassed $400,000 for the first time, rising 14.2 percent from one year ago to $413,500. Year-over-year price appreciation eased slightly compared with the previous quarter’s 15.4 percent.
“Home prices have increased at a pace that far exceeds wage gains, especially for low- and middle-income workers,” NAR Chief Economist Lawrence Yun said in a release. “Overall, the national price deceleration inevitably followed the softening sales, providing well-positioned prospective buyers a small measure of welcomed relief. The recent dips in mortgage rates will bring additional buyers to market, especially in those places where home prices are still relatively affordable and where jobs are being added.”
The report found the South accounted for 44 percent of single-family existing-home sales in the second quarter and posted the largest price appreciation of 18.2 percent. Prices increased 12.7 percent in the West, 10.1 percent in the Northeast and 9.7 percent in the Midwest.
The top 10 metro areas with the largest year-over-year price gains were Fayetteville-Springdale-Rogers, Ark.-Mo. (31.9 percent); Lakeland-Winter Haven, Fla. (31.4 percent); Naples-Immokalee-Marco Island, Fla. (28.9 percent); North Port-Sarasota-Bradenton, Fla. (28.8 percent); Myrtle Beach-Conway-North Myrtle Beach, S.C.-N.C. (28.5 percent); Tampa-St. Petersburg-Clearwater, Fla. (28 percent); Cape Coral-Fort Myers, Fla. (27.8 percent); Punta Gorda, Fla. (27.4 percent); Ocala, Fla. (26.7 percent); and Ogden-Clearfield, Utah (25.5 percent).
According to the report, the most expensive markets in the U.S. were San Jose-Sunnyvale-Santa Clara, Calif. ($1.9 million); San Francisco-Oakland-Hayward, Calif. ($1,55 million); Anaheim-Santa Ana-Irvine, Calif. ($1.3 million); Urban Honolulu, Hawaii ($1,145 million; San Diego-Carlsbad, Calif. ($965,900 ); Boulder, Colo. ($933,400); Naples-Immokalee-Marco Island, Fla. ($850,000); Los Angeles-Long Beach-Glendale, Calif. ($825,700); Seattle-Tacoma-Bellevue, Wash. ($818,900); and Boston-Cambridge-Newton, Mass.-N.H. ($722,200).
“The local job market performance and supply availability are the clear distinguishing factors driving local home price growth,” Yun said. “Job growth is positive and should be applauded, but supply restraints are creating unnecessary barriers to ownership opportunities.”
NAR found houses became less affordable during the second quarter. The monthly mortgage payment on a typical existing single-family home with a 20 percent down payment increased to $1,841 in the second quarter, an increase of $444 – or 32 percent – from the first quarter and $612 – or 50 percent – from one year ago. During the second quarter, families typically spent 24.3 percent of their income on mortgage payments, up from 18.7 percent the prior quarter and 16.9 percent one year ago.