CoreLogic: Wichita area home prices post strong gain

04/03/2013 9:26 AM

04/03/2013 5:51 PM

Wichita area home prices, excluding distressed sales, rose 7.2 percent between February 2012 and February 2013, according to a just-released report by CoreLogic, a national real estate data firm that surveys local markets.

If distressed sales, such as short sales and foreclosures, are included, year-over-year prices were up by 4.7 percent in February, compared with the year before.

A report by the Wichita Area Board of Realtors puts the one-year price increase even higher, at 10 percent.

Nationally, home prices jumped the highest amount in seven years, according to CoreLogic.

It’s evidence that the housing market is beginning to rebound, say local experts.

Stan Longhofer, director of the Center for Real Estate at Wichita State University, cautioned that Wichita isn’t yet a market that favors sellers, but it no longer penalizes them.

“If a buyer thinks it is like it was two years ago and demands a low price and then asks for something else to be thrown in, they will be left out in the cold.”

He said official figures show that a home’s average time on the market is five to six months – generally considered a market balanced between sellers and buyers. However, he noted that the average is skewed by some homes that are on the market a lot longer – homes that aren’t attractive to buyers and would be hard to sell in any market. The effective supply of homes in good condition and in good locations, he said, is actually less than five months.

Another factor, he said, is that rising home prices will push up many underwater home mortgages. The owners could become more interested in putting their homes on the market because they don’t have to come up with cash to sell.

Tessa Hultz, CEO of the Wichita Area Association of Realtors, said that February’s results are a continuation of a string of year-over-year home price increases that began last year.

“I think it’s a return of consumer confidence,” she said. “You’re seeing unemployment go down a bit and the stock market go up, and there’s less news about layoffs. There were always plenty of people able to pay sitting on the sidelines by choice.”

Nationally, home prices rose 10.2 percent in February compared with a year earlier, according to CoreLogic. That was the biggest annual gain since March 2006.

Prices have now increased on an annual basis for 12 straight months, underscoring the recovery’s steady momentum.

The gains were broad-based. Prices rose in 47 of 50 states and in all but four of the nation’s 100 largest metro areas. Delaware, Alabama and Illinois were the only states to report price declines.

CoreLogic’s measure of national prices also rose 0.5 percent in February from January. That’s a solid increase during the winter months, when sales typically slow.

An increase in home sales has helped lift prices. In February, sales of previously owned homes reached the highest level in more than three years. Still, much of the demand has come from investors. Sales to first-time buyers remain below healthy levels.

Another reason prices are rising is that the supply of available homes for sale remains extremely low. In January, it reached a 13-year low.

The supply of homes for sale did rise in February for the first time in 10 months. That suggests more people are gaining confidence in the housing recovery, which could help ease supply concerns and drive sales higher in the coming months.

The price gains were concentrated in the West, according to CoreLogic. The states with the biggest price gains were Nevada, where prices rose 19.3 percent, followed by Arizona, with 18.6 percent, and California, with 15.3 percent.

The cities with the biggest gains were Phoenix, Los Angeles, Riverside, Calif., Atlanta and New York.

Nationwide, home values in February were still down more than 26 percent from their peak in April 2006, CoreLogic said.

Contributing: Associated Press

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