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FOURTH-QUARTER HOME PRICES RISE STEADILY IN RESPONSE TO GROWING DEMAND

 WASHINGTON, Feb. 9 /PRNewswire/ -- Home prices rose steadily throughout many metropolitan areas during the final quarter of 1992, as low mortgage rates and improved consumer confidence sparked an increase in housing demand, according to the National Association of Realtors.
 Both the Midwest and South were dominated by markets with healthy home price gains. Strong price increases were posted in the northwestern section of the West, and the some gains occurred in the Northeast.
 According to NAR President William S. Chee, the overall strength of the housing market late last year was attributable to the heavy volume of purchases by both first-time buyers and those trading up. "Consumers have started feeling more confident about buying big- ticket items. We're seeing a lot of pent-up demand being absorbed," Chee said. "People are coming out of the woodwork."
 The association's metropolitan home price survey showed that 18 areas, most of which were lower-priced, recorded double-digit price gains between the fourth quarter of 1991 and the fourth quarter of 1992. The Richland/Kennewick/Pasco counties of Washington, with a median price of $94,700, recorded the largest price increase, at 26.1 percent. Oklahoma City, at $67,200, had the second highest increase, which was 18.3 percent. Spokane, Wash., with a price of $80,400, ranked third, with an increase of 18.1 percent.
 The report covered median prices for single-family detached and attached existing homes in 125 metropolitan statistical areas(A). Prices in the fourth quarter ranged from $352,000 in Honolulu to $49,400 in Waterloo/Cedar Falls, Iowa. A median price is the midpoint in the price range; half the homes sell for more and half sell for less.
 Continued low mortgage rates throughout October, November and December made the market more affordable for buyers in a lower income range. According to the Federal Home Loan Mortgage Corp., the average commitment rate for fixed-rate, 30-year conventional mortgages was 8.21 percent during the fourth quarter, nearly one-half percentage point below a year ago.
 Chee noted that rates are expected to stay very affordable this year, and likely will slip below the current level over the next few months. "The outlook for housing looks very promising," he said. The national median price for the fourth quarter was $103,400, which was 4.3 percent higher than the fourth quarter of 1991. Sixty-three areas posted price gains exceeding the national price increase.
 The Midwest, which has the largest concentration of affordable homes, was boosted by purchases in the lower-price range. According to NAR Chief Economist John A. Tuccillo, the Midwest continues to be the region with the strongest overall residential real estate market. Six cities in the region posted double-digit appreciation between the fourth quarter of 1991 and the fourth quarter of 1992.
 Leading the price gains in the Midwest was Akron, Ohio, where the median price of $82,400 rose 15.1 percent from the fourth quarter of 1991. In Lincoln, Neb., the median price of $69,400 rose 14.0 percent; and in Waterloo/Cedar Falls, the price of $49,400 rose 12.0 percent. For the Midwest as a whole, the fourth-quarter median price was $82,100, rising 5.5 percent from one year earlier. "The economic recovery will ensure steady growth in the Midwest this year," Tuccillo said.
 Several areas in the southwestern portion of the South experienced high price increases. In addition to Oklahoma City's extraordinary price jump, the median price for Corpus Christi, Texas, $69,600, rose 16.2 percent. In Houston, the median price of $81,900 rose 15.4 percent, and in Mobile, Ala., the price of $66,700 rose 14.8 percent. "It appears that the oil patch is getting back on sound footing," Tuccillo said. For the South as a whole, the median price for the fourth quarter of 1992 was $92,100, up 4.3 percent from the same quarter one year earlier.
 The West contained six areas posting double-digit appreciation between the final quarter of 1991 and the final quarter of 1992. In addition to Richland/Kennewick/Pasco and Spokane, the Eugene/Springfield area of Oregon posted a 14.9 percent increase for its median price, which was $84,900. In Albuquerque, N.M., the price of $96,500 rose 11.6 percent. "High demand in the lower-priced markets has really bumped up prices," Tuccillo said. For the West as a whole, the fourth-quarter price was $141,300, which was 1.1 percent below the fourth quarter of 1991. Marginal changes in the median prices for most of the California markets held down the median price for the region.
 The Northeast contained several pockets of notable activity. In the Middlesex/Somerset/Hunterdon counties of New Jersey, the median price of $167,100 rose 7.5 percent between the fourth quarter of 1991 and the fourth quarter of 1992; and in the Monmouth/Ocean counties of New Jersey, the price of $135,800 rose 5.4 percent. Pittsburgh's price of $78,500 rose 6.9 percent. The region's overall price for the fourth quarter was $136,300, which was 0.8 percent below that for the fourth quarter of 1991. "Domination by entry-level buyers is accounting for soft prices in many areas of the Northeast," Tuccillo explained.
 For the year as a whole, the national price was $103,600, rising 3.3 percent from 1991. Seventy-seven areas recorded price increases exceeding the national increase.
 According to Tuccillo, housing activity this year is expected to surpass that of last year, as more consumers resume house hunting. "Housing is a major player in the economic recovery," he said.
 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) The seasonally adjusted annual rate for a particular quarter represents what the total number of actual sales for a year would be if the relative resale pace for that quarter were maintained for the year's four consecutive quarters.
 Seasonally adjusted annual rates are used in reporting quarterly data to factor out seasonal variations in resale activity. For example, home sales volume normally is higher in the summer and relatively light in the winter, primarily because of differences in the weather.
 -0- 2/9/93
 /CONTACT: Trisha Morris, 202-383-7560, Walter Molony, 202-383-1177, or Cheryl Spector, 202-383-1289, all of the National Association of Realtors/


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

IH -- DC005 -- 4468 02/09/93 08:45 EST
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Date:Feb 9, 1993
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