Midwest Housing Most Affordable
WASHINGTON (AP) _ The Midwest had the most affordable existing homes as 1989 ended, while the most expensive existing housing was found on both coasts, a real estate trade group reported Wednesday.
Peoria, Ill., had the lowest median price, $47,200, of the 83 metropolitan areas surveyed by the National Association of Realtors. That was $233,700 below the median cost of a home in Honolulu, the most expensive area in the survey.
Low-cost existing housing, as opposed to new homes, in the final quarter of 1989 also was found in Oklahoma City and Spokane, Wash., where the median price in both areas was $53,900; Mobile, Ala., $56,400; and Louisville, Ky., $58,000.
Joining Honolulu in the top expensive areas were the San Francisco Bay area, where the median price was $260,600; Orange County, Calif., $247,900; and Los Angeles, $217,000. Boston had the highest price tag on the East Coast, $183,600.
The median price means half of the homes cost more and half less. The survey covered existing single-family detached homes, townhouses, condominiums and cooperatives.
The national median price was $92,800 in the October-December period, a 4.6 percent advance from the fourth quarter of 1988. Forty-eight metropolitan areas recorded price increases exceeding the national increase.
Median prices in the Midwest were $71,700, a 5.9 percent gain over the same quarter of 1988. The South posted an $83,100 median price, up 4.3 percent.
The Northeast’s median price stalled in the fourth quarter, rising only 0.9 percent to $144,000. The West had the largest gain, 9 percent to $141,600.
Realtors President Norman D. Flynn cited the smaller urban markets as ″the ones offering both moderately priced housing and a strong, diverse economic base.″
″Affordable homes within a reasonable commute make these cities a prime target for companies looking to expand or relocate,″ Flynn said.
Sales of existing homes, which were weak earlier in the year, perked up as mortgage rates fell from their March peak into the single digits.
John A. Tuccillo, the Realtors chief economist, said interest rate declines during the fall produced across-the-board sales increases in the fourth quarter.
Nationally, sales were up 2.1 percent over the third quarter to a seasonally adjusted annual rate of 3.85 million units. Sales for the year, however, were off 4.3 percent to 3.78 million units.
The West was the fastest growing market as the year ended, posting an 8.2 percent increase to an annual rate of 660,000 units for the October-December period.
It was followed by a sales gain of 2.8 percent, to 1.45 million units, in the South, and a 1 percent advance, to 1.04 million units, in the Midwest.
Sales slumped in much of the Northeast, where they were off 2.6 percent to 701,000 units at an annual rate for the quarter. For the year, sales declined 11.8 percent, to 741,000 units.
Twenty-nine states posted sales increases over the third quarter, ranging from 0.9 percent in Hawaii to 30.5 percent in Vermont.
Flynn said the 1990 housing market is expected to be much like 1989 - strong in some areas, average in others and sluggish in parts of the nation where the economy is weak.