Home sales in the South rose nearly 8 percent in February, as federal tax credits and bargain prices enticed buyers.
Last month, 113,000 homes were sold in the region, but the median sales price dipped 4 percent from a year ago to $139,600, the National Association of Realtors said yesterday. Sellers cut asking prices to compete with low-priced foreclosures that are entering some Southern markets at a steady pace.
Nationally, sales of previously occupied homes climbed 8 percent from February last year to a non-seasonally adjusted mark of 302,000. The median home price dropped almost 2 percent from a year ago, to $165,100.
The looming expiration of two federal tax credits at the end of April likely attracted more house shoppers in the South, as did low interest rates.
But the housing recovery remains on shaky ground. Foreclosure sales are expected to continue pulling down prices. High unemployment and tight lending standards are keeping many buyers on the sidelines.
Sales of previously occupied homes in February declined in 13 out of 19 Southern cities covered by the Associated Press-Re/Max Monthly Housing Report, also released Tuesday. Median sales prices slid in 12 of the 19 Southern cities.
Still, there are positive signs. For instance, sales in the Florida cities of Miami, Orlando and Tampa increased significantly in February, keeping a months-long trend intact.
A steady flow of migration to Florida, and more interest in second homes from Northerners whose stock portfolios have improved, are reasons for tempered optimism.
“The problems remaining are huge, but this is a bit of information that is encouraging,” said Dave Denslow, a University of Florida economist.
The AP-Re/Max report analyzes sales transactions in the metropolitan statistical areas recorded by all real estate agents, regardless of company affiliation.
Leading the way in sales was Orlando, which saw a surge of 42 percent compared with last February, the AP-Re/Max report showed. Prices fell 23 percent to $109,950, the biggest drop among the 19 Southern cities covered by the report.
Fast condo sales were a major influence on sales activity and prices in Orlando. Buyers are snapping up foreclosed condo units at prices as low as $50,000 — cash.
“Investors are competing for bargains as we speak,” said Les Simmonds, president of LG Simmonds Real Estate Corp. in the Orlando suburb of Longwood, Fla. “We’re still trying to move through all of this inventory.”
In terms of median sales prices, the Houston metro area saw the largest increase among the Southern cities featured in the AP-Re/Max report, rising 6 percent to $147,000.
The increase was fueled by a 16 percent spike in sales of houses priced between $250,000 and $500,000, and a 15 percent jump in sales of houses priced $500,000 and above, the Houston Association of Realtors reported.
Next in line was the Washington metro area, where prices climbed nearly 5 percent to $277,250. Sales fell 8 percent.
People appear eager to grab the first-time homebuyer tax credit of $8,000, which is set to expire April 30, along with a $6,500 credit for current homeowners.
“The most recent data confirms the high level of pent-up demand that is fueling the spring market,” said Donna Evers, president of Evers & Co. Real Estate in Washington.