More than 11% of homes sold over the past 12 months had a sales price over $500,000, sales growth was highest among homes in above-median-priced categories not entry level starter homes according to a new analysis by an economist at the National Association of Realtors.
In spite of the price variation by region, when summed to the regional level the median sales price for all regions of the US except the West falls into the $100,000 to $250,000 price range. The median price is the point at which the middle-priced home sold. By definition, half of homes in an area sold at a higher price and half of homes sold at a lower price than the median, according to Danielle Hale, a research economist at NAR.
Roughly a fifth of homes sold for less than $100,000 a year ago and that share shrank in September 2013 to 17.4 percent. One year ago, homes sold at $500,000 or more were roughly 10 percent of the market; they now comprise more than 11 percent of recently sold homes, Hale wrote in a post on NAR’s site.
“There are coincident reasons for this trend: 1) sales growth is highest among homes in the highest home price tiers, and 2) home sales are shrinking in the lowest price tier-most likely a result of limited inventory in this price range as would be expected in a housing market where prices are rising.
Sales in the lowest price tier fell by more than 7 percent nationally while sales in higher priced categories were up by more than 30 percent from September one year ago,” she said.
While distressed sales as a share of closed sales ticked up in September, the longer-term trend for these properties has been down. Single-digit market share of distressed properties could be seen in the months ahead. This means smaller inventories of low-priced homes and smaller sales shares for low price homes relative to high priced homes which will mean continued upward pressure on the median price of homes compared to one year ago until additional inventories help relieve some of this pressure.