Home prices rise in Iowa City, fall in C.R.

Home prices rose in March in Iowa City on a year-over-year basis, but continued to fall in Cedar Rapids.

Iowa City home prices, including distressed sales, increased by 1.45 percent in March when compared with March 2010, according to Santa Ana, Calif.-based CoreLogic. Excluding distressed sales, year-over-year home prices in Iowa City increased by 0.99 percent in March compared with March 2010.

Cedar Rapids home prices, including distressed sales, declined by 4.56 percent in March when compared with the same month of 2010. Excluding distressed sales, year-over-year prices in Cedar Rapids declined by 2.37 percent in March when compared with the same month of 2010.

Distressed sales include short sales and real estate owned by bank transactions.

Home prices fell nationally for the eighth month in a row, according to the CoreLogic. Home prices, including distressed sales, declined by 7.5 percent in March compared with March 2010 after declining by 5.8 percent in February. Excluding distressed sales, year-over-year prices declined by 0.96 percent in March compared with March 2010 and by 2 percent in February.

 "Last year the first time homebuyer tax credit pulled a significant number of sales forward and, to an extent, artificially supported prices. So, absent the tax credit, it is understandable that we see prices continue to decline when compared with last year," said Mark Fleming, chief economist with CoreLogic. "As we move further away from that support, we will see a leveling of prices and eventually improvements in the market."

Caroline Ruhl, president of Ruhl & Ruhl of Davenport, with offices in Cedar Rapids and Coralville, was not surprised to see sales and home prices down in the first quarter.

"We anticipated that first quarter sales would be down because we are comparing them to tax credit stimulated sales last year. The unusually harsh winter also didn't help," Ruhl said. "The really good news is that commencing in April the buyers have come back and activity is strong.

 "Pent up buyer demand that stayed home during the first quarter appears to be out in full force. With interest rates still at historically low levels,  buyers are wise to take advantage of our good inventory of homes to sell."