The Chen Agency

The Chen Agency

02/24/10/ The Record / Real Estate

December home prices up 0.3 percent

By: Adrian Sainz

MIAMI – Home prices edged up in December, the seventh straight monthly gain and another sign the housing market continues its bumpy recovery. Prices aren’t anywhere near the zenith of the housing boom – they are down 30 percent from the peak in May 2006 – and there are worries that the recovery may not last. But prices have been steadily increasing from month to month, climbing almost 4 percent off the bottom in May. The Standard and Poor’s/Case Shiller 20-city home price index released Tuesday rose 0.3 percent from November to December, to a seasonally adjusted reading of 145.87. The index was off about 3 percent from December last year, nearly matching analysts’ estimates. Anna Piretti, an economist at BNP Paribas, said the price increases are “further evidence that conditions in the house market continue to stabilize.” Case-Shiller does not break out data by counties, but according to two regional multiple listing services, Bergen County prices and sales volume rose in December 2009 compared with December 2008 – a time when the economy and housing markets were reeling in response to the fall’s credit crisis. According to figures from the New Jersey Multiple Listing Service, the median price of a single family home in Bergen County was $440,000 in December 2009, up 6 percent from a year earlier. There were 402 single-family homes sold in the county in December, up 33 percent from a year earlier. In Passaic County, the median home price was $295,531, down 2.8 percent from a year earlier. The volume of sales was down 0.6 percent. “It’s a clear indication that the bleeding has stopped,” said Nelson Chen of the Chen Agency in Fort Lee. “People are coming back to the table, deals are being made and the price drops have stopped.” But there are still obstacles that could derail the recovery. First, consumer confidence took a surprisingly sharp fall in February amid rising job worries, ending three straight months of improvement. Also, roughly 5 percent of homeowners with a mortgage are in foreclosure, the Mortgage Bankers Association reported last week. As those deeply discounted homes hit the market, they will keep pushing down prices. Some economists fear that demand and prices will fall after two federal tax credits expire in April. And, a Federal Reserve program aimed to keep mortgage rates low is set to end March 31. “Prices have stabilized and are starting to rise, but forces that will bring them back down are growing,” wrote Patrick Newport, an economist with HIS Global Insight.