Two reports released Tuesday paint a mixed picture of the state of the real estate market, with overall prices plummeting during the first quarter followed by a slight uptick in April and a 3 percent increase in the sales of newly constructed homes.
Prices for single-family homes dropped 14.1 percent across the nation in the first quarter of 2008 as compared to the same period in 2007, according to the Case-Schiller Home Price Index. This is the largest one-quarter drop since in 1988, when Standard & Poor’s began releasing the index, which compares the recent sales price of the single-family detached homes with their earlier sale price.
Home prices have not been this low nationwide since the third quarter of 2004, according to Maureen Maitland, an S&P vice president, but the index is still up 60 percent over 2000, she added. On a somewhat positive note, new homes sales jumped 3.3 percent in April, according to the Commerce Department, from 509,000 units in March to 526,000 units in April, seasonally adjusted. Median prices actually rose 1.5 percent from April 2007 to $246,100.
In the Washington metro area, prices dropped 2.5 percent from February to March, according to the Case-Schiller index, and 14.7 percent from March 2007. Among the nation’s 20 major metropolitan markets, including Washington, prices dropped 2.2 percent from February to March and 14.4 percent since March 2007.
“The first quarter of this year was bad,” said Donna Evers, president and broker of Evers & Company Real Estate. Evers, who monitors D.C., Alexandria, Falls Church, and Montgomery, Fairfax and Arlington counties, said that even in these areas, which have performed better than outlying Loudoun, Prince William and Prince George’s counties, dollar volume of sales for condos and single-family homes was down 40 percent in March from the previous year and 18.45 percent in April. Prices held steady in the areas inside the Beltway, though, and Evers is predicting a better picture for May, June and July, even going as far as to say that the market may have hit bottom for the closer-in areas in the first quarter.
But for areas farther out, recovery will take much longer. In fact, Evers was surprised that home prices were only down 14.4 percent in the metro area in March, since the Case-Schiller index also includes counties farther out, such as Calvert, Charles and Frederick in Maryland; Clarke, Stafford, Spotsylvania, Warren and Fauquier in Virginia and Jefferson in West Virginia, which experienced significant price declines.
