Home prices climbed in 93 percent of U.S. metropolitan areas in the second quarter, the broadest gain in a decade, led by Palm Bay and Port St. Lucie, Florida.
The median price of an existing single-family home rose from a year earlier in 163 of the 176 areas measured, the National Association of Realtors said in a report Tuesday. It was an improvement from the first quarter, when 85 percent of metropolitan areas had price increases.
The widespread gains underscore how the housing market strengthened across the country in the key spring selling season, with price increases magnified by buyer competition for a tight supply of properties. Sales of existing homes climbed to an eight-year high in June, bolstered by an improving labor market, rising household formation and low mortgage rates.
“There are folks who have been waiting a long time to make a move, who have been running out of space for a long time,” said Mark Vitner, senior economist at Wells Fargo Securities in Charlotte, North Carolina. “Now that we’re making progress in the quality of jobs, and not just the number, they’re getting enough confidence to make that decision.”
The national median single-family home price reached a record $229,400 in the second quarter, up 8.2 percent from a year earlier. That surpassed the $227,600 peak set in the third quarter of 2005.
The best-performing areas in the second quarter were Palm Bay and Port St. Lucie, where the median price jumped 20 percent from a year earlier, followed by Sebastian and Vero Beach, Florida, with a 19 percent gain. Prices climbed 17 percent in Raleigh, North Carolina, and 16 percent in Greensboro and High Point, also in North Carolina.
Thirteen areas posted declines, led by Cumberland, Maryland, where the median price fell 17 percent. Bridgeport, Connecticut, had a 5.6 percent drop and Kingston, New York, was down 5.3 percent. New Haven, Connecticut, was No. 4, with a loss of 5 percent.
The supply of homes for sale averaged 5.1 months from April through June, data from the Realtors association show. Six months of inventory is considered a balanced market, according to Lawrence Yun, chief economist of the group.
“Steady rent increases, the slow rise in mortgage rates and stronger local job markets fueled demand throughout most of the country this spring,” Yun said in Tuesday’s report. “While this led to a boost in sales paces not seen since before the downturn, overall supply failed to keep up and pushed prices higher in a majority of metro areas.”