Prices of condominiums are starting to play catch up with single-family homes.
According to DataQuick, condo price increases outpaced those of single-family homes in nine of 11 big counties in the 12 months ended March 2013. In the two counties where single-family homes outperformed condos, the difference was a negligible 0.2% or less.
This relative performance is in contrast to the previous six years, when condos underperformed single-family homes in eight of the 11 markets tracked by the company.
Despite the recent gains, prices of both condos and single-family homes haven’t come back nearly to where they were before the housing bubble burst. In fact, in only one county—Denver—have prices made a full recovery; indeed, single-family homes are worth more than they did in 2006.
The figures used by DataQuick are indexed median prices at the zip code level, then plussed up to the county level. As a result, price changes can vary at different zip codes within each county, explains Randy Wussler, vice president of product management and marketing at San Diego-based Data Quick.
In aggregate, condo prices in the 11 counties where DataQuick provided information rose 12.7% in the 12 months ended March 2013. That compares to a little less than 10% among single-family detached homes.
The biggest price performance differential among the big counties tracked by the company in the past year was in Maricopa County, Ariz., where Phoenix is located. The county was one of the worst hit in the housing market crash.
Condo prices in the county jumped nearly 25% in the 12 months ending in March. But detached homes did pretty well, too, advancing more than 16%.
Despite these recent gains, prices of both condos and detached homes are still well below where they were before the crash. The median index price of a condo in the county was $121,800 in March 2013, 33% below the $182,000 figure in March 2006. The median price of a detached house was $125,900 recently, more than 31% below the $184,300 figure at the peak.
Clark County, Nev., home to Las Vegas, also showed strong price appreciation in 2013, although there too, prices remain well below where they were at the peak.
According to DataQuick, condo prices in Clark County rose more than 23% in the past year, compared to the 19% gain in detached houses. However, despite the recent rise, median prices of both condos and single-family homes are only about half of what they were seven years ago.
In Miami-Dade County, Fla., another hard hit area, condo prices rose nearly 19% in the past year, outpacing the 12% increase for detached homes. Condos are now worth about 71% of what they went for in 2006, while detached homes are worth only about two-thirds of what they fetched back then.
In Denver County, where prices never got as out of line as they did in places like Phoenix and Las Vegas, prices have made a full recovery. Median prices of single-family homes are now slightly higher than they were in 2006, while condos are exactly where they were back then.
In Los Angeles County, the biggest area tracked by DataQuick, condo prices rose more than 12% in the past year, compared to a nearly 9% gain in single-family homes. However, detached homes have recovered more of their value since 2006 than condos have: Condos are worth only 66% of what they were worth in 2006, while single-family dwellings are worth 74%.
Before the crash, condos were worth more than single-family homes in Los Angeles on average, but that’s not true anymore. The median condo price in LA in 2006 was $220,200, compared to $212,800 for single-family homes. In March 2013, however, the median price of a condo was $145,800, compared to $157,500 for a detached home.
DataQuick provided a representative sampling of figures for those parts of the country where it has better granular detail on local home prices at the zip code level.
George Yacik has been covering the residential mortgage business for more than 20 years and writes frequently for industry publications. He can be reached at gyacik@yahoo.com.
