By Maryann Haggerty
Washington Post Staff Writer
Sunday, March 26, 2006

The median price of single-family houses and townhouses in the Washington region vaulted past $400,000 last year, making inexpensive housing more and more of an oxymoron here.

In a year marked by frantic bidding wars among buyers anxious not to miss out on a house, any house, the median sales price for the region jumped 27 percent to $419,000, up from $330,000 in 2004, according to a Washington Post analysis of government sales records for single-family houses and townhouses.

Prices for condominiums escalated even more steeply, rising 34 percent to $281,000.

The median is the point at which half of the homes sold cost more and half cost less.

In order to buy that $419,000 house, a home buyer who made a 20 percent down payment of $83,800 would face monthly principal and interest payments of $2,119 per month on a fixed-rate 6.5 percent, 30-year mortgage. However, to actually buy those houses last year, an increasing number of people turned to adjustable-rate mortgages and newly popular interest-only loans.

Nationally, home prices also hit record levels during 2005. It became fashionable to wonder whether the nation was caught up in a housing bubble, a la the Internet stock market bubble of the 1990s. The macroeconomic verdict is still out on whether the tremendous price inflation experienced in many parts of the country was really a bubble that will pop with unforeseen consequences, or whether it was a run-up that will be gradually corrected. However, there are signs nationally and locally that, indeed, the mania has cooled, with housing starts and sales down in recent months.

In this region, Alexandria remained the most expensive jurisdiction among the cities and counties The Post examined, with a median house price of $585,000, up 17 percent from 2004.

In Arlington, Fairfax and Loudoun counties, the median price also moved past the half-million mark.

Only one county still has a median price below $300,000 -- Prince George's, where the median rose 29 percent to $287,000.

An increase in median price does not mean the value of each individual home in an area went up that much. Instead, medians can vary depending upon what type of houses change hands. For instance, the sharpest run-up came in Prince William County, where there has been an increase in construction of more luxurious homes, as well as an increase in population. The median price there was $398,000, up 33 percent.

The volume of single-family and townhouse sales during the year fell about 2 percent to 104,827. Some of this drop-off may be the result of a slowing market, but some may also be a statistical artifact. The District of Columbia was unable to supply December sales records in time for this analysis, and there may be other jurisdictions where recording of sales lagged, too. The number of condo sales rose 8 percent to 20,990.