The national median existing single-family home price increased 3.9% annually to $254,800 in the first quarter, according to the latest quarterly report from the National Association of Realtors.
Despite this increase, Q1’s total now sits below the annual increase of 4% in the fourth quarter of 2018.
However, home prices did increase in 86% of measured markets, equating 153 out of 178 metropolitan areas. About 7% of these metros, which represents 13 areas, saw price increases in the double digits this quarter.
Notably, this is slightly down from the 14 metros that experienced double-digit increases last quarter.
NAR Chief Economist Lawrence Yun said the first quarter has been beneficial to U.S. homeowners.
“Homeowners in the majority of markets are continuing to enjoy price gains, albeit at a slower rate of growth. A typical homeowner accumulated $9,500 in wealth over the past year,” Yun said.
In fact, total existing home sales, including single-family homes and condos, increased 1.2% from a seasonally adjusted annual rate of 5.143 million sales in the fourth quarter to 5.207 million in the first quarter. Nevertheless, this total is still 5.4% below the 5.507 million sales in the first quarter of last year.
To combat these slower price gains, Yun suggests the construction industry develops more affordable housing units.
“More supply is needed to provide better homeownership opportunities, taming home price growth and widening the inventory choices for consumers,” Yun said. “Housing Opportunity Zones could provide the necessary financial benefits for homebuilders to construct moderately priced-homes.”
According to NAR’s analysis, there were 1.68 million existing homes available for sale across the country. This is 2.4% higher than the 1.64 million homes for sale at the end of the first quarter of 2018. Additionally, the average supply of homes was 3.8 months during the first quarter, up from 3.5 months last year.
Notably, NAR indicates that national family median income increased to $77,752 in the first quarter, but overall affordability fell once again annually.
So, when buying a single-family home at the national median price, NAR says a buyer making a 5% down payment would now need an income of $60,143. A buyer making a 10% down payment would need an income of $56,978 and for a 20% down payment a buyer needs to make $50,647.