Home prices rise in Corridor, sales picture mixed in February

The average price of a new or existing home sold in the Corridor increased in February from the same month in 2011, but the number of homes sold fell in Cedar Rapids and was unchanged in Iowa City.

The Cedar Rapids Area Association of Realtors said the average price of a home sold in February was $152,447, up 7.1 percent from $142,335 in February 2011. The number of homes slipped to 171 last month from 191 in February 2011.

The Iowa City Area Association of Realtors said the average price of a home sold last month in the southern end of the Corridor was $195,534, up 10.7  percent from $177,024 in February 2011. A total of 88 homes were sold last month, unchanged from February 2011.

The average number of days that a home stayed on the market was 122 in the Iowa City-Coralville-North Liberty area, up from an average 110 days in February 2011. The Cedar Rapids Area Association of Realtors does not disclose the average number of days on the market.

Statewide, 1,869 new or existing home were sold last month, according to the Iowa Association of Realtors, up from 1,559 homes sold in February 2011. The average price of a home sold in Iowa last month was $127,578, down 0.4 percent from an average $128,112 in February 2011.

The average rate on 30-year fixed rate mortgages rose, but hovered near historic lows this week, making home buying and refinancing more attractive to those who can qualify.

Mortgage buyer Freddie Mac said Thursday that the rate on 30-year loans increased to 3.92 percent from 3.88 percent the previous week. The rate touched 3.87 percent four weeks ago, the lowest since long-term mortgages were initially offered in the 1950s.

The average on 15-year fixed mortgages rose to 3.16 percent from a record low 3.13 percent last week.

Rates on 30-year loans have been below 4 percent for three months. While continued low rates would suggest this year could mark a turnaround for the depressed housing market, many people are unable to qualify for those rates.

Builders are more optimistic after seeing more people express interest in purchasing a home. Construction has picked up, and builders are requesting more permits to build single-family homes. The supply of homes on the market is falling, but there's also a significant number of homes in foreclosure.

Millions of foreclosures and short sales -- when a lender accepts less than what is owed on a mortgage -- remain on the market. And the housing crisis and recession also have persuaded many Americans to rent instead of buy, which has led to a drop in home ownership.Economists say housing is years away from returning to full health.

To calculate its average rates, Freddie Mac surveys lenders across the country Monday through Wednesday each week.

The average rates don't include extra fees, known as points, which most borrowers must pay to get the lowest rates. One point equals 1 percent of the loan amount.

The average fees for 30-year and 15-year fixed loans were 0.8 percent, unchanged from last week.

For five-year adjustable loans, the average rate rose to 2.83 percent from 2.81 percent, and the average fee edged up to 0.8 percent from 0.7 percent.

The average on one-year adjustable loans rose to 2.79 percent from 2.73 percent, and the average fee was unchanged at 0.6 percent.