While Single Family Prices Make Biggest Drop in S&P Index’s History, Apartment Prices Show Signs of Flattening
- Oct 28, 2008
By Anuradha Kher, Online News EditorNew York–Even though the apartment sector had the highest returns over the past 12 months among all commercial real estate types at +0.4 percent, prices remained flat, according to Standard & Poor’s July results for the S&P/GRA Commercial Real Estate Indices. Nationally, commercial real estate prices for July 2008 too were level versus July 2007. The National composite reported an annual price change that was flat, compared to July of 2007. This is down from the +1.5 percent reported in June’s data. It is also well below this cycle’s peak of +14.7 percent, reported in August of 2006, and is the lowest growth rate in the near 15-year history of the index. The index for apartments in July 2008 was 142.52 down -0.9 percent in the June-July period, down 1 percent in the May-June period and with a 0.4 percent year-on-year change.Meanwhile, single-family home prices in 20 cities fell 16.6 percent in August compared with a year ago—the biggest annual drop in the history of the Case-Shiller Home Price Index.”The downturn in residential real estate prices continued, with very few bright spots in the data,” says David M. Blitzer, chairman of the Index Committee at Standard & Poor’s. Based on the latest report on condo prices for the second quarter of 2008 released by the National Association of Realtors (NAR), metro area condominium and cooperative prices – covering changes in 54 metro areas – showed the national median existing-condo price was $220,000 in the second quarter, down three percent from $226,900 in the second quarter of 2007. Seventeen metros showed annual increases in the median condo price and 37 areas had price declines.The strongest condo price increases were in the Syracuse, N.Y., area, where the second quarter price of $144,900 rose 17.8 percent from a year earlier, followed by the New Orleans-Metairie-Kenner area of Louisiana, at $192,100, up 15.9 percent, and the Houston-Baytown-Sugar Land area of Texas, where the median condo price of $141,100 rose 9.9 percent from the second quarter of 2007. Areas where condo prices declined mirrored the pattern seen with single-family homes.Metro area median existing-condo prices in the second quarter ranged from $107,500 in the Wichita, Kan., area to $523,500 in the San Francisco-Oakland-Fremont area. The second most expensive condo market reported was Honolulu at $330,000, followed by Los Angeles-Long Beach-Santa Ana at $327,800.Other affordable condo markets include Greensboro-High Point, N.C., at $109,600 in the second quarter, and the Indianapolis area at $113,500.