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More Metro Home Prices Above Pre-Recession Peaks; Homeownership Tenure Drops
Median home prices in 57 of 105 of metro areas (54 percent) were above their pre-recession home price peaks in the first quarter, reported ATTOM Data Solutions, Irvine, Calif.
The report also noted homeowners who sold in the first quarter had been in their homes an average of 8.00 years, down 2 percent from 8.14 years in the fourth quarter. This represented the largest quarterly drop in average homeownership tenure since Q4 2008, but still up from 7.69 years a year ago.
The company’s quarterly U.S. Home Sales Report said nationwide, the median home price of $240,000 in the first quarter was less than 1 percent below its pre-recession peak of $241,500 in Q3 2005, but up by 9.1 percent from a year ago. Metro areas with median home prices the furthest above their pre-recession peaks were Houston (69 percent); Dallas-Fort Worth (67 percent); Denver (62 percent); San Jose, Calif. (60 percent); and San Antonio (57 percent).
“Rising interest rates and recently enacted tax reform that removed some tax incentives for homeownership were not enough to cool off red-hot home price appreciation in many parts of the country, with 30 of the 105 local markets analyzed posting double-digit gains in median home prices in the first quarter,” said Daren Blomquist, senior vice president with ATTOM. “Home prices are still below pre-recession peaks in 46 percent of local markets, but nearly one-third of even those markets posted double-digit home price appreciation in the first quarter.”
The report said median home prices in 48 of the 105 metro areas analyzed in the report (46 percent) were still below pre-recession peaks in the first quarter, including Bridgeport, Conn. (25 percent); New Haven, Conn. (22 percent); Allentown, Pa. (21 percent); Philadelphia (20 percent); and Hartford, Conn. (19 percent).
Metro areas posting biggest year-over-year increase in median home prices were San Jose (33 percent); Flint, Mich. (20 percent); Spokane, Wash. (18 percent); Reno, Nev. (17 percent); and Seattle (16 percent).
The report said among 40 metropolitan statistical areas with a population of at least one million, biggest quarterly drop in average homeownership tenure were reported in Cleveland, Ohio (6 percent); Seattle (6 percent); Salt Lake City (5 percent); Minneapolis-St. Paul (4 percent); and Sacramento, Calif. (4 percent).
ATTOM said homeowners who sold in the first quarter realized an average home price gain since purchase of $53,369, down from an average gain of $54,000 in the fourth quarter but up from an average gain of $45,000 a year ago. The average home seller gain of $53,369 in the first quarter represented an average 29.5 percent return as a percentage of original purchase price, down from a 29.8 percent return in the previous quarter but up from a 25.7 percent return a year ago.
Among 154 metropolitan statistical areas analyzed in the report, those with the highest average home seller returns in the first quarter were San Jose (109.1 percent); San Francisco (73.6 percent); Seattle (66.0 percent); Kahului, Hawaii (65.3 percent); and Vallejo-Fairfield, Calif. (58.8 percent).
The report said homes selling for more than $1 million accounted for 4.18 percent of all U.S. single family home and condo sales in the first quarter, up from 4.02 percent in the fourth quarter and up from 3.38 percent of all sales a year ago to the highest level since Q4 2007.
Other key findings
–Sales to buyers using FHA loans (typically first-time homebuyers) accounted for 11.9 percent of all single-family home and condo sales in Q1 2018, down from 12.6 percent in the previous quarter and down from 14.4 percent in Q1 2017 to the lowest level since Q1 2014, a four-year low.
–Distressed home sales, including bank-owned sales, third-party foreclosure auction sales and short sales, accounted for 14.7 percent of all single-family home and condo sales in Q1 2018, up from 13.6 percent in Q4 2017 but still down from 16.9 percent in Q1 2017.
–All-cash purchases represented 30.0 percent of all single-family home and condo sales in Q1 2018, up from 28.7 percent in Q4 2017 but down from 31.5 percent in Q1 2017.
–Sales to institutional investors (entities purchasing at least 10 properties in a calendar year) accounted for 1.7 percent of all single-family home and condo sales in Q1 2018, down from 3.6 percent in Q4 2017 and down from 2.0 percent in Q1 2017 to the lowest level as far back as data is available, Q1 2000.