by The Associated Press filed 4:50pm ET April 22nd, 2010
BOSTON (AP) — Sales of existing homes in the Northeast surged nearly 27 percent in March compared to the previous year, continuing to outpace other regions in what promises to be at least a temporary rebound in the housing market.
Median home prices in the Northeast climbed nearly 9 percent to $249,800, also the highest in the nation, as many sellers benefited from reduced inventory and more competition among buyers.
Nationally, sales of previously occupied homes rose nearly 20 percent from March 2009, without adjusting for seasonal factors, the National Association of Realtors said Thursday. The median sales price was flat at $170,700.
Reasons cited by economists included the tax credits for homebuyers, set to expire April 30, and low mortgage rates. The average interest rate for a traditional fixed-rate mortgage is 5.07 percent, Freddie Mac said Thursday.
”I’d say the worst of the housing (slump) has ended for most areas and the outlook has improved,” said Frederick Breimyer, past president of the New England Economic Partnership. ”But we still have a lot of foreclosures out there, so we are not home free and there is a nagging trail of grief because of all the damage down by high unemployment.”
Sales in all 10 Northeast cities tracked by the Associated Press-Re/Max Monthly Housing Report increased in March compared to the same month a year ago. The report, also released Thursday, analyzed sales transactions in the metropolitan statistical areas recorded by all real estate agents, regardless of company affiliation.
Some highlights of the report:
–Biggest sales gain: All the Northeast cities in the report posted double-digit sales increases in March, with the smaller Augusta, Maine market leading the way with a 60 percent jump over the previous year. But major markets posted equally impressive gains, including metro New York (40 percent), Boston (31 percent), Pittsburgh (21 percent) and Philadelphia (19 percent).
–Smallest sales gain: Sales in Manchester, N.H., an industrial city about 50 miles north of Boston, rose about 11 percent in March compared to the same month in 2009.
–Biggest price increase — Sellers finally had something to cheer about as prices stabilized or increased in all markets. The median selling price for a home in Boston was $315,000, up nearly 13 percent, while in Pittsburgh the median selling price of $127,000 in March more than 10 percent higher than a year ago.
Even Rhode Island, one of the hardest hit states in the national recession, appears to be sharing in the housing market recovery. Home sales were up about 35 percent in Providence, and the median selling price of $189,000 was up almost 7 percent from March 2009.
Richard J. Loughlin, Jr., president of the central and northern New England division for Coldwell Banker Residential Mortgage, said listings were up significantly in the Boston-area as sellers moved to take advantage of increased buyer activity spurred by national tax credits. First-time buyers can get up to $8,000, and current homeowners who buy and relocate can get up to $6,500.
Sales activity is even picking up in more exclusive suburban neighborhoods, said Kate Rossi, who oversees Coldwell-Banker’s Westchester County, N.Y., office.
”(Homeowners) are coming to the reality that if they want to sell their house they have to price it right,” said Rossi. ”The buyer today is looking for value and they are not going to overpay.”
Realtors also said a reduction in the backlog of inventory in some markets — Pittsburgh was down 24 percent — was giving sellers more hope of getting the value they were seeking.
”We have a lot of agents who are dealing with multiple offers on properties,” said Christa Ross of Re/Max Select Realty in Cranberry Township, Pa.
She related the story of one couple that had its eyes on a particular neighborhood and had six properties to choose from last summer. They decided to wait, but when they came back in March to look in the same neighborhood, Ross said she had nothing to show them.
What happens after April 30 deadline for the tax credit remains very much a wild card, with realtors hopeful but unwilling to predict whether the positive momentum will continue as the calendar turns toward the dog days of summer.
”It will be interesting to see how it all unfolds. The jury is out,” said Coldwell-Banker’s Rossi.