Home prices rose in 81 percent of U.S. metropolitan areas in the fourth quarter, with the pace of gains accelerating even as sales slowed from earlier in the year, the National Association of Realtors said.
The median price of an existing single-family home increased from a year earlier in 145 of the 179 markets measured, the group said in a report Wednesday. In the third quarter, 87 percent of metropolitan areas had price increases. Thirty regions had gains of 10 percent or more in the fourth quarter, up from 20 markets in the previous three months and 22 a year earlier.
Price gains across the nation are being bolstered by strengthening employment, low borrowing costs and buyer competition for a limited supply of available properties. There were 1.79 million previously owned homes for sale in December, down 3.8 percent from a year earlier, the Realtors group said last month. At the current pace of deals, it would take 3.9 months to sell those houses, the lowest since January 2005.
“Even with slightly cooling demand, the unshakable trend of inadequate supply in relation to the overall pool of prospective buyers inflicted upward pressure on home prices in several metro areas,” Lawrence Yun, the group’s chief economist, said in Wednesday’s report. “As a result, homeownership continues to be out of reach for a number of qualified buyers in the top job producing, but costliest, parts of the country -– especially on the West Coast and parts of the South.”
Prices declined from a year earlier in 34 metro areas, or 19 percent of the markets tracked, according to the report.
The national median single-family home price was $222,700 in the fourth quarter, up 6.9 percent from a year earlier, according to the report. In the third quarter, the median price increased 5.4 percent from a year earlier.
The most expensive markets in the fourth quarter were all in the West, led by San Jose, California, with a median of $940,000. The median was $781,600 in San Francisco and $716,600 in Honolulu.
The cheapest areas were Youngstown, Ohio, with a median of $81,200; Cumberland, Maryland, with $86,100; and Rockford, Illinois, with $87,600.
Sales of previously owned homes, including single-family and condominiums, declined 5.4 percent in the fourth quarter from the previous three months to a seasonally adjusted annual rate of 5.18 million. That was up from the 5.06 million pace in the fourth quarter of 2014.