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updated 12/29/2004 1:43:29 PM ET 2004-12-29T18:43:29

The math is simple: Low interest rates plus a growing economy equal a strong housing market.

The Office of Federal Housing Enterprise Oversight in Washington, D.C., reported that the average price of a U.S. home increased 12.97 percent from the third quarter of 2003 through the third quarter of 2004. Appreciation in the fourth quarter of 2004 was 4.62 percent, or an annualized rate of 18.48 percent.

The growth in home prices in the last year eclipsed any annual increase in the last 25 years, the Office of Federal Housing Enterprise Oversight reported.

For most individuals, their home is the largest — and best — investment. And with the rising values and lower rates, it may be a good time to sell and move into a bigger house.

Las Vegas home owners saw their values increase the most, nearly 42 percent, compared with a 35 percent statewide gain in Nevada. San Bernardino-Ontario, Calif., was second in the nation with an annual appreciation of 33.81 percent. Other hot housing markets were Honolulu; Washington, D.C., including the Virginia suburbs of Arlington and Alexandria; and Atlantic City, N.J.

Prices in California's Silicon Valley remained flat after the dot-com bubble burst in 2001, but rose 12.5 percent in San Jose, Sunnyvale and Santa Clara in 2004. However, prices in San Francisco, north of Silicon Valley, and Oakland-Fremont, east of techie heaven, rose 17.2 percent, the Office of Federal Housing Enterprise Oversight reported.

If you are thinking of moving, grab a calculator and see if your dreams of spiffier digs pencil out.

"The number one thing to do when preparing to sell your home is getting rid of clutter," says Walter Molony, a spokesman for the National Association of Realtors in Washington, D.C. "Clutter makes your house look smaller."

Since competition is fierce, make the listing agent and bank earn your business.

Franchised giants such as Coldwell Banker and Century 21, divisions of Cendant, go head-to-head with local or regional companies. Review the market in your area by checking the real estate listings online with major Internet companies such as America Online, a division of Time Warner; Yahoo!; Google; and MSN. (MSNBC content is distributed by MSN. MSNBC itself is a Microsoft - NBC joint venture.)

When looking for a mortgage, start with a Web site like LendingTree, a division of IAC/InteractiveCorp. Don't forget the Web sites of major banks, including Citigroup, J.P. Morgan Chase, Bank of America and Wells Fargo.

© 2012 Forbes.com

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Data: Latest rates in the US

Home equity rates View rates in your area
Home equity type Today +/- Chart
$30K HELOC FICO 4.71%
$30K home equity loan FICO 5.26%
$75K home equity loan FICO 4.70%
Credit card rates View more rates
Card type Today +/- Last Week
Low Interest Cards 13.42%
13.42%
Cash Back Cards 17.94%
17.94%
Rewards Cards 17.14%
17.14%
Source: Bankrate.com