WASHINGTON >> Housing values rose during the third quarter of 2002 but at a slower rate than earlier in the year. The government says it's an indication that runaway prices are starting to slow. Mainland home
sales slowingEconomists see the more moderate
increase in real estate values as a
predictable correction rather
than dramatic shiftBy Jonathan D. Salant
Associated Press
The Office of Federal Housing Enterprise Oversight, which regulates government-sponsored mortgage companies Freddie Mac and Fannie Mae, said the average price of a home rose 0.84 percent between July and September, after growing by 2.39 percent between April and June. Prices rose by 1.94 percent during the third quarter of 2001 and 2.11 percent during the second quarter.
STAR-BULLETIN / APRIL 2002
Honolulu homes and condominiums continue to sell at a brisk pace, even as the mainland market begins to cool. These homes are on Wilhemina Rise.
(In Hawaii, prices rose 1.60 percent during the third quarter, a slightly slower growth than the 2.27 percent increase in the second quarter. However, in Honolulu, prices increased 2.02 percent during the July-September period, greater than the 1.96 percent increase in the second quarter.
(Over the past year, Hawaii home prices rose 7.12 percent, the report says. Honolulu home prices increased 6.92 percent.)
Shelly Dreiman, a senior economist with the agency, said housing prices could not continue to rise faster than the rate of inflation.
During the 12-month period from October 2001 to September 2002, the consumer price index rose 1.5 percent while housing prices increased by 6.2 percent. Between July and September, housing prices trailed the index, which rose 2.5 percent.
"It's just a market correction," Dreiman said. "You wouldn't expect to see prices going up and sustaining those rates forever. Generally, it's going to start moving back toward general price inflation."
