Home Sales Decline in 28 States, D.C.

Is the housing bubble about to burst? Home Sales Decline in 28 States, D.C. Aug 15, 2:13 PM (ET) By MARTIN CRUTSINGER WASHINGTON (AP) - The slowdown in the once-sizzling housing market is spreading, with 28 states and the District of Columbia reporting spring sales declines, led by big drops in former boom areas of Arizona, Florida and California. Nationally, sales were down 7 percent in the April-June quarter this year compared with the same period in 2005, the National Association of Realtors said Tuesday in its latest state-by-state look at housing conditions around the country. The Realtors survey showed that the biggest declines occurred in states that had been enjoying red-hot sales during the five-year housing boom. The five biggest declines this spring compared to the April-June period of 2005 were Arizona, down 26.9 percent; Florida, down 26.7 percent; California, down 25.3 percent; Virginia, down 23.9 percent, and Nevada, down 23.5 percent. The Realtors report depicted a tale of two housing markets, with former boom areas experiencing declines and other areas of moderate sales gains during the boom years experiencing strong growth. In all, 20 states had sales gains in the spring, led by Alaska, which enjoyed a 48.6 percent jump in sales; followed by Arkansas, up 17.9 percent; Texas, up 11.3 percent; North Carolina, up 11 percent, and Vermont, up 9.1 percent compared to the spring of 2005. "States with moderately priced areas that have experienced healthy job creation are seeing sales gains," said David Lereah, chief economist for the Realtors. "The economic backdrop remains favorable for the housing market, which is helping home sales level out." In a separate survey of price changes in 151 metropolitan areas, the Realtors reported that 26 metro areas experienced outright price declines while 37 areas were still enjoying double-digit price increases. The biggest price drops in percentage terms were in Danville, Ill., where home prices fell by 11.2 percent in the spring compared with the spring of 2005, and the Detroit area, where home prices were down 8 percent. At the other end of the scale, prices rose the most in Baton Rouge, La., reflecting a 27.3 percent increase, followed by Ocala, Fla., where prices rose by 25.3 percent, and the Virginia Beach, Va., area, where prices were up 23.6 percent compared with the spring of 2005.>