Monday, May 15, 2006

Here Comes The Cooler

Link To This Post.
Here Comes The Cooler., by Les Christie:
Real estate gains came to an abrupt halt in the first quarter of 2006, with the median price of a U.S. home falling 3.3 percent from the fourth quarter of 2005, according to a report released Monday morning.

Prices were basically flat or lower during the quarter as inventories of houses for sale rose and their time spent on the market lengthened, according to a survey of 149 markets by the National Association of Realtors.

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… From the fourth quarter of 2005 to the first quarter of 2006, median prices nationwide fell from $225,300 to $217,900, a drop of 3.3 percent. It's the second consecutive quarter that prices showed a sequential decline; in the fourth quarter of 2005, prices fell 1 percent from the third quarter.

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The report quoted NAR's chief economist David Lereah saying, "With the supply of homes picking up very nicely in many areas of the country, pressure is coming off of home prices."

Lereah is optimistic that the market will soon return to growth. "By the time we report second quarter data, I expect most areas will be returning to normal rates of price growth in the single-digit range."

-- The Boy in the Big Housing Bubble