Kansas City, Mo. Home sales in the Midwest declined again in March as lingering economic uncertainty kept early spring home shoppers from becoming buyers, but the region still fared better than the rest of the country, according to two reports released Thursday.
Existing home sales in the 12-state area slid almost 7 percent from March last year, according to the National Association of Realtors. The median price in the Midwest declined 6 percent from March 2008 to $141,300. In both instances, they were the smallest declines of any region.
Nationally, home sales slipped 4 percent from a year ago, without adjusting for seasonal factors. Prices tumbled 12 percent to $175,200.
Home sales fell in 11 of 12 major Midwestern cities tracked in The Associated Press-Re/Max Monthly Housing Report, also released Thursday. The survey includes all home sales recorded in the metropolitan statistical area by all local agents, regardless of company affiliation.
Chicago; Wichita, Kan.; Indianapolis; and Fargo, N.D., posted the biggest losses in the region, dropping by 23 percent or more.
“The issue for the Midwest is unemployment, unemployment, unemployment,” said Diane Swonk, chief economist for Mesirow Financial in Chicago. “We do have affordability. That is in our favor. We have lower interest rates. That should be helping the first-time home buyers. The biggest hurdle for us is certainty on jobs.”
The only Midwestern city that saw an annual increase in sales was Minneapolis, where depressed home prices attracted bargain hunters. Overall sales increased almost 8 percent in March while the median sale price fell 25 percent to $152,000.
Home sales in Wichita plummeted by 35 percent in March from a year ago, according to the AP-Re/Max report. The median home sale price also fell, but only by 4 percent to $113,000.
Stan Longhofer, director of Wichita State University’s Center for Real Estate, said the city has so far not seen a big impact from major layoffs this winter in the aviation industry.
“I think what’s been very different with this downturn has been that a lot of people who are not affected directly (by layoffs) are behaving with a lot of fear and they’re just holding back from any big-ticket purchases,” Longhofer said.
But Josh Roy, an agent with Keller Williams Realty in Wichita, said that fear is beginning to dissipate.
“Thirty to 40 percent of the buyers out there are first-time home buyers,” Roy said. “It is truly making up a large portion of our business.”