Report shows strong gains in California and Florida and a slowdown in other areas
February 12, 2004: 10:57 AM EST
By Sarah Max CNN/Money staff writer
BEND, Ore. (CNN/Money) - After peaking during the third quarter of 2003, the housing market slowed down a bit during the fourth quarter, a real estate group said Thursday.
Nationally, median home prices increased 6.6 percent to $171,600, according to the National Association of Realtors (NAR). In the previous quarter, year-over-year prices increased 10.1 percent.
Hot Housing Markets
Home prices in these areas saw the greatest gains between the fourth quarters of 2002 and 2003
Market Price change Median price
Riverside/San Bernardino CA 28.9% $239,400
Sarasota, FL 26.1% $222,100
Los Angeles/Long Beach, CA 24.5% $382,200
Miami/Hialeah, FL 22.9% $236,900
Anaheim/Santa Ana, CA (Orange Count) 21.2% $526,800
San Diego, CA 20.4% $456,700
West Palm Beach/Boca Raton, FL 19.2% $252,900
Brandenton, FL 18.7% $186,100
Reno, NV 17.3% $228,100
Hartford, CT 17.0% $214,700
Source: National Association of Realtors
In addition, there were fewer markets in which prices rose at least 10 percent. Prices in 33 markets out of 127 markets tracked by the NAR rose in the double digits, down from a record 41 in the third quarter.
In fact, 22 markets showed slight price declines over the past 12 months. Among the markets where home prices declined the most were Jackson, Miss. (down 5.4 percent) and Akron, Ohio (down 5.3 percent).
Last quarter, only Fort Wayne, Ind. experienced a drop in prices.
"What we're seeing now is a natural easing after a record pace of home sales in the third quarter," said NAR chief economist David Lereah in a release.
There was no sign of a slowdown in select markets in California and Florida. Eight out of 10 markets with the largest increases were in these two states.
Home prices in Riverside and San Bernardino counties, near Los Angeles, had the greatest year-over-year gains for the third consecutive quarter The median price for existing single-family homes in the area is now $239,400, up 28.9 percent from a year ago. Prices in Los Angeles, meanwhile, went up 24.5 percent.
Sarasota, Fla. saw the second largest price gain. The median-price home increased 26.1 percent to $222,100.
In Orange County, also near Los Angeles, prices increased 21.2 percent, bringing the median price to $526,800 -- nearly $80,000 more than in the first quarter of 2003. Home prices in Orange County are second only to San Francisco, where the median is $574,300.
A shortage of housing is responsible for the huge gains in these areas, according to NAR president Walt McDonald, who is also a realtor in California.
The NAR expects median prices to increase only 5 percent nationally in 2004. Over time, home price gains typically are one to two percentage points above the rate of inflation, according to the NAR.
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