Realtors Group Sees Rising Home Prices

Sales of existing U.S. homes, spurred by falling mortgage rates, will rise in 35 states this year, and prices will increase in 110 of 113 metropolitan areas, the National Assn. of Realtors said.

Nevada will post the largest increase in homes sold, a 25% rise, compared with last year, followed by Alaska, up 23%, and New Mexico, up 21%.

Sacramento will post the biggest price increase, an 18% rise to $170,200, followed by a 12% gain in Washington. The area around South Bend and Mishawaka, Ind., also will have about a 12% increase.

The housing market is benefiting from a drop in interest rates even as economic growth slows. Rates on a 30-year mortgage have averaged 7.01% this year, down from 8.05% in 2000, according to Freddie Mac, the No. 2 mortgage buyer.