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| More rates and news from Its Official Home Prices Decline In Third Quarter Of 2006
(That title may seem redundant upon first glance, as it is a well-known fact that home prices have been declining throughout most of the United States in 2006. )
However, what is not known is that there has never been a year-over-year price decline from a single quarter since 1993, until the third quarter of 2006. And even more amazingly, every region in the U.S. experienced at least a slight price decline during this quarter.
The article, “Home Prices Fall For First Time In 13 Years,” written November 24, 2006 by Broderick Perkins, illustrates how this housing price decline is significant for a multitude of reasons.
“It was 1993, and William Jefferson Clinton was sworn in as the 42nd president of the United States. The Buffalo Bills lost their fourth consecutive Super Bowl Game and became the only NFL team to do so. A van bomb exploded beneath the World Trade Center in New York City, killing 6 and injuring more than 1,000 people.”
1993 also marked the last time the national median home price fell from its previous year. According to the National Association of Realtors (NAR), the median single-family home price in the first quarter of 1993 dropped .04 percent to $103,500 from $103,900 in the first quarter of 1992.
“The median home price was $224,900 in the third quarter this year, down 1.2 percent from a year earlier when the median price was $227,600, according to the NAR's Third Quarter Metro Report.”
“No region escaped falling prices as existing single-family home prices fell in the South by 0.1 percent, in the West by 0.9 percent, in the Midwest by 2.6 percent and in the Northeast by 4.8 percent.”
This is an interesting trend considering that the NAR reported 102 of the 148 metropolitan areas actually experienced price increases over the past year.
What does this mean? Well, it can easily be assumed that in areas where prices are falling, they are falling hard and fast, like California.
“‘With the market in full transition, buyers now have choices and sellers are more willing to negotiate -- under these circumstances it's no surprise that overall home prices are slightly below a year ago. We expect this trend to continue in the months ahead, but we'll see modest appreciation in most of the country in 2007,’ said David Lereah, NAR's chief economist as sales continued to take a drubbing.”
Total home sales experienced a 12.7 percent decrease in the third quarter, as the market continues to falter.
Although the market is expected to pick back up in 2007, expect a couple more quarters of price declines as sellers try to relinquish their abundance of inventory. And buyers are becoming more intelligent to the situation they are in control of and will not buy until prices lower more in their favor.
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