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New figures from the NAR highlight the reality of the USA’s ‘prolonged slump’…
The National Association of Realtors (NAR) recently reported that median prices for existing single-family homes dropped in 100 of 149 metropolitan areas in the January-March period, while 48 metropolitan areas saw prices increase and one reported no change.
Lawrence Yun, chief economist for the NAR, explained: “The price declines in 67 percent of the areas surveyed was the largest percentage of areas reporting declining prices in the history of the Realtors’ survey, which goes back to 1979. Prices had fallen in 34 percent of the cities surveyed in the October-December survey.
“These are highly unusual results because there were very few jumbo loan originations in the latest quarter, so sales are much slower in high-cost areas, and at the same time foreclosures related to subprime mortgages rose,” he said.
“Part of the problem in the first three months of the year was that it was hard to get so-called jumbo loans because of the credit squeeze triggered by rising mortgage defaults, particularly for subprime loans, mortgages made to borrowers with weak credit histories. Jumbo loans are critical to finance homes in high-cost areas of the country”.
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