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STEADY GAINS SEEN IN FIRST-QUARTER HOME PRICES

 WASHINGTON, May 5 /PRNewswire/ -- Home values in many less-expensive metropolitan areas continued to rise during the first quarter of 1993, as favorable mortgage rates spurred buyer demand in the lower price ranges, according to the National Association of Realtors.
 Outside of a couple of price spikes in the Northwest and Midwest, many areas in all regions posted moderate home value increases. Market variations in home prices are largely traceable to the availability of affordable housing and local economic health, said NAR President William S. Chee.
 The association's metropolitan home price survey for the second quarter of 1992 showed that median prices for existing single-family homes ranged from $347,000 in Honolulu to $44,300 in the Waterloo/Cedar Falls area of Iowa. The survey covered median prices for single-family detached and attached existing homes in 129 metropolitan statistical areas(A). A median price is the midpoint; half the homes sell for more and half sell for less.
 Extremely low mortgage rates throughout the first quarter of this year made the market more affordable for buyers in a lower income range. As a result, many of the sales that took place were of lower-priced homes, Chee said. "We are seeing more and more people buying starter homes," he said. Heavy activity by first-time buyers has triggered sales in the move-up market, Chee noted. "Homeowners who have been thinking about trading up are going for it. Buyers are coming to open houses, and they're ready to make offers," he said.
 According to the Federal Home Loan Mortgage Corp., the average commitment rate for fixed-rate, 30-year conventional mortgages dropped from 8.00 percent to 7.50 percent between January and March. Rates generally remained at least 1 percentage point below that for one year ago.
 Housing demand in the first quarter was boosted by restored consumer confidence in addition to low mortgage rates, Chee noted. "When people feel good about the economy, they buy. They're willing to increase their debt," he said.
 The national price for the first quarter was $104,200, rising 5.1 percent from one year earlier.
 Several markets in the Midwest, the region with the nation's largest concentration of affordable homes, were boosted by a flurry of home buying activity. According to NAR Chief Economist John A. Tuccillo, the Midwest contains some of the healthiest housing markets in the nation. "The Midwest has a good combination of economic stability and low-cost housing," Tuccillo said.
 Leading the price gains in the Midwest was Detroit, where the median price of $92,200 jumped 19.0 percent from the first quarter of 1992. In Madison, Wis., the median price of $97,700 rose 9.3 percent; and in Cedar Rapids, Iowa, the price of $73,400 rose 9.2 percent. The median price for the entire region was $83,900 in the first quarter, up 7.8 percent from the same period one year ago.
 The South, another region with a large supply of affordable housing, also experienced heavy entry-level activity. Ft. Myers, Fla., and Charleston, W.Va., led the region in home appreciation, with 10.2 percent increases in their median prices for the first quarter of 1993. The median price in Ft. Myers was $76,400, and in Charleston, it was $75,400. In the Biloxi/Gulfport area of Mississippi, the price of $60,500 rose 7.4 percent, while in San Antonio, the price of $72,600 rose 6.8 percent. In the South as a whole, the first-quarter price of $90,700 rose 2.7 percent.
 A decline in the median price for several markets in the Northeast shows that many home sales are occurring in the lower price range. In the New York metropolitan area, the median price of $168,000 dropped 0.5 percent from the first quarter of 1992; in Boston, the price of $165,200 fell 1.8 percent.
 However, one area in the Northeast posted a strong price gain in the first quarter. In Syracuse, N.Y., the median price of $86,100 rose 11.2 percent from one year earlier. The Northeast's first-quarter price was $137,400, unchanged from one year earlier.
 The Northwest portion of the West contained one area with an extraordinary home price increase in the first quarter. In the Richland/Kennewick/Pasco counties of Washington, the median price of $96,400 soared 24.5 percent, which was the highest percentage gain recorded in NAR's survey. In Spokane, Wash., the median price of $79,100 rose 10.9 percent. The median price of $94,400 in Albuquerque, N.M., rose 8.9 percent. The home price spurts in these areas show that activity continues to shift northward and inland from the California coast, Tuccillo said.
 For instance, in Los Angeles(B), the median price of $199,700 dropped 8.0 percent from a year ago; in Anaheim/Santa Ana, Calif.(B), the price fell 5.6 percent to $222,200; and in San Diego(B), the price fell 3.8 percent to $175,500. "California is feeling the impact of unstable economic conditions," Tuccillo said. However, he pointed out that buyer's market conditions are prevalent for people who are in a position to buy. In the West, the fist-quarter price of $142,200 dropped 0.5 percent from a year ago.
 The National Association of Realtors, "The Voice for Real Estate," is the nation's largest trade association, representing nearly 750,000 members involved in all aspects of the real estate industry.
 (A) All areas surveyed are metropolitan statistical areas (MSAs) as defined by the U.S. Office of Management and Budget. They include the specified city and surrounding suburban areas.
 (B) Provided by the California Association of Realtors.
 -0- 5/5/93
 /CONTACT: Trisha Morris, 202-383-7560, Annemarie Roketenetz, 202-383-7560, or Scott Sherwood, 202-383-1016, all of the National Association of Realtors/


CO: National Association of Realtors ST: District of Columbia IN: CST SU: ECO

TW -- DC003 -- 4715 05/05/93 08:48 EDT
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Date:May 5, 1993
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