Sunday, November 22, 1998

Home prices rising faster than inflation in many cities

By DAVE SKIDMORE

Associated Press

WASHINGTON -- Prices of existing homes are rising faster than inflation in many metropolitan areas, with the strongest increases showing up along the West Coast and in some Southern cities.

Nationally, the median resale price -- meaning half sold for more and half for less -- was $132,700 during the July-September quarter, up 4.9 percent from the median during the same quarter a year earlier, the National Association of Realtors said.

The increase matched the 4.9 percent increase in personal incomes over the same period, but was more than double the inflation rate in consumer prices of around 2 percent.

"This is preserving a good balance of buyers and sellers in most areas of the country," said Realtors President Sharon A. Millett.

Thirteen of 132 metro areas surveyed by the trade group reported median price increases greater than 10 percent. Only seven areas reported price declines.

Median resale prices ranged from $69,700 in Waterloo, Iowa to $330,700 in San Francisco.

The cities with the top five increases were: Charleston, S.C., 18.1 percent; Orange County, Calif., 17.4 percent; Seattle, 14.4 percent, and Montgomery, Ala., and Beaumont, Texas, both 13.9 percent.

Other cities with double-digit gains over the year were San Francisco; San Diego; Jacksonville, Fla.; Los Angeles; Biloxi, Miss.; Davenport, Iowa; Omaha, Neb., and Wichita, Kan.

The cities with the five worst drops were Greenville, S.C., 6.5 percent; Honolulu, 5.9 percent; Amarillo, Texas, 3.7 percent; Akron, Ohio, 3.6 percent, and Springfield, Mass, 3.1 percent.

Others with declines were Birmingham, Ala., and Nashville, Tenn.

By region, the Midwest and West posted the largest increases, 7.2 percent and 7.1 percent, respectively. The Northeast lagged, with a 2.1 percent rise. In the South, the median advanced 5.1 percent.