All good things must come to an end.
S&P/Case-Shiller announced Tuesday that the average value of a home has dropped 1.4 percent for the first quarter of 2007.
This drop represents the first time that the average value has slipped since the third quarter of 1991.
“Properties have to be priced properly, you can?t just put your property up for 20 percent more than the person next door. The message is slowly getting out to the people,” said Thomas Hough, president of the Anne Arundel County Association of Realtors.
“What you really have is a difference of expectation. People were expectingto be able to move their properties at a higher rate in both speed and dollars, and they are finding that properties are still moving, but we are at the same level we were in 2003.”
Nationally, homes are selling for a median price $220,900 for April, the National Association of Realtors released Friday.
During April of last year, the median was 0.8 percent higher at $222,600.
In the Baltimore region, the median price for a home is $275,000 for April, up around $7,000 from the same month a year ago. Howard County is the highest locally at $390,000, while Baltimore City is the lowest at $158,728.
And with the dip in existing home prices, builders in new home construction are feeling the effects on the market.
Estimates from the National Association of Home Builders indicate that new housing starts across the country may not fully rebound until 2011.
David Seiders, NAHB?s chief economist, said he believes new housing starts need to jump up 21 percent to 1.85 million in order to hit full recovery.
In April, there were 1.53 million new starts nationally, with 2.29 million serving as the benchmark established in January 2006.
“We?ve fallen way below trend because we soared way above trend during boom times,” Seiders told Bloomberg. “The upswing will be relatively slow, unlike earlier cycles.”
Staff researcher Kiel McLaughlin contributed to this story.
