Southland home sales, median price up over last year
January 19, 2010
La Jolla, CA---Southern California home sales in December remained
above year-ago levels for the 18th consecutive month, bolstered by
gains in many mid- to high-end communities. The median sale price rose
year-over-year for the first time since summer 2007, reflecting a more
normal distribution of sales across all price categories, a real
estate information service reported.
A total of 22,328 new and resale homes sold in Los Angeles,
Riverside, San Diego, Ventura, San Bernardino and Orange counties last
month. That was up 16.4 percent from November’s 19,181, and up 12.1
percent from 19,926 in December 2008, according to MDA DataQuick of
San Diego.
Sales almost always rise from November to December. Last month’s
gain was a bit higher than the average increase of 13 percent since
1988, when DataQuick’s statistics begin.
The December sales tally was the highest for that month since
24,209 homes sold in December 2006, but it was still 11.2 percent
below the average for a December – 25,143 sales – over the past 22
years.
The sales pattern has changed a lot over the past year, with many
mid-to high-end communities now contributing more transactions.
For example, relatively large annual sales gains were recorded last
month in many well-known, higher-end markets including Beverly Hills,
Santa Monica and Newport Beach – areas that saw very low sales a
year ago. Meanwhile, some of the more affordable inland areas that saw
robust 2008 sales recorded year-over-year declines last month. Those
markets included Moreno Valley, Lake Elsinore and Palmdale.
The percentage of Southland homes sold above $500,000 last month
rose to 20.2 percent of all sales, up from 16.5 percent a year earlier
and the highest since it was 23.6 percent in August 2008. On average
since 2000, $500,000-plus sales have made up 36.5 percent of total
sales. Right before the credit crunch hit in August 2007, making
larger “jumbo” mortgages more expensive and harder to obtain,
$500,000-plus sales made up about 52 percent of Southland
transactions.
More sales in once-dormant high-end communities helps explain last
month’s year-over-year gain in the median sale price – the point
where half of the homes sold for more, half for less.
The median paid for all Southland houses and condos sold in
December was $289,000, up 1.4 percent from $285,000 in November and up
4 percent from $278,000 a year earlier. The last time the median
increased year-over-year was in August 2007, when it rose 2.7 percent
to $500,000, near its peak.
The median has increased or held steady for eight consecutive
months, but in December it was still 42.8 percent lower than the peak
Southland median of $505,000 reached during several months in early
and mid 2007. In late 2008 and early 2009, the monthly declines in the
median from a year earlier ranged from 30 to 40 percent.
“Several forces have pulled the region’s median sale price out
of its nose dive and given it lift,” said John Walsh, MDA DataQuick
president.
“We’ve seen the re-selling of foreclosed homes fall off its
peak in newer lower-cost inland areas, while at the same time sales
have started to pick up in some of the more established expensive
areas. That simple shift in what’s selling, and what’s not
selling, puts upward pressure on the median. That’s statistical. But
we’ve also seen price floors, however temporary, form in many areas
recently as the foreclosure inventory dwindled and buyers took
advantage of lower prices, lower mortgage rates and tax credits. A
meaningful comeback in the jumbo loan market would provide another big
boost to the pricier areas.”
Last month there were only modest signs of improvements in the
jumbo market. Mortgages above $417,000 – formerly the definition of
a jumbo loan – accounted for 16.7 percent of all home purchase
loans, the highest since 18.7 percent in January 2008. Such jumbo
loans made up nearly 40 percent of purchases before the credit crunch.
Another form of financing critical to high-end sales also edged
higher in December: 4.6 percent of purchase loans had an adjustable
rate, which was the highest since adjustable-rate mortgages (“ARMs”)
made up 7.2 percent of all home loans in September 2008. However, it
was still far lower than the average monthly ARM rate of 51 percent
since 2000.
December’s foreclosure resales remained well below peak levels
but were still a large force in the market, edging higher than the
prior month for the first time since last February. Foreclosure
resales – houses and condos sold in December that had been
foreclosed on in the prior 12 months – were 39.6 percent of resales,
up from 39.0 percent in November but down from 53.5 percent in
December 2008. They hit a high of 56.7 percent last February, then
tapered or leveled off month-to-month until last month’s uptick.
First-time buyers and investors, including some paying all cash,
continued to dominate the buy side of the market last month.
Government-insured FHA loans, a popular choice among first-time
buyers, accounted for 39.6 percent of all home purchase mortgages in
December.
Absentee buyers – mostly investors and some second-home
purchasers – bought 19.2 percent of the homes sold in December.
Buyers who appeared to have paid all cash – meaning there was no
indication that a corresponding purchase loan was recorded –
accounted for 24.9 percent of December sales, based on an analysis of
public records. That’s up from 22 percent in December 2008 but lower
than the 2009 peak of 26.9 percent in September. The 22-year monthly
average for Southland homes purchased with cash is 13.8 percent.
The “flipping” of homes has also trended higher over the past
year. Last month the percentage of Southland homes flipped – bought
and re-sold – within a three-week to six-month period was 3.1
percent. It varied from as little as 2.4 percent in San Diego County
to as much as 3.8 percent in San Bernardino County. A year ago all
Southland counties had flipping rates under 2 percent.
MDA DataQuick, a subsidiary of Vancouver-based MacDonald Dettwiler
and Associates, monitors real estate activity nationwide and provides
information to consumers, educational institutions, public agencies,
lending institutions, title companies and industry analysts.
The typical monthly mortgage payment that Southland buyers
committed themselves to paying was $1,231 last month, up from $1,207
for November, and down from $1,239 for December a year ago. Adjusted
for inflation, current payments were 44.4 percent below typical
payments in the spring of 1989, the peak of the prior real estate
cycle. They were 54.4 percent below the current cycle’s peak in July
2007.
Indicators of market distress continue to move in different
directions. Foreclosure activity remains high by historical standards,
although mortgage default notices have flattened out or trended lower
in many areas. Financing with multiple mortgages is low, down payment
sizes are stable, and non-owner occupied buying is above-average in
some markets, MDA DataQuick reported.
|
Sales
Volume |
Median
Price |
| All
homes |
Dec-08 |
Dec-09 |
%Chng |
Dec-08 |
Dec-09 |
%Chng |
| Los
Angeles |
5,848 |
7,679 |
31.3% |
$320,000 |
$339,000 |
5.9% |
| Orange |
2,580 |
2,885 |
11.8% |
$397,000 |
$435,000 |
9.6% |
| Riverside |
4,435 |
4,282 |
-3.4% |
$209,000 |
$196,000 |
-6.2% |
| San
Bernardino |
2,862 |
2,934 |
2.5% |
$180,000 |
$154,000 |
-14.4% |
| San
Diego |
3,325 |
3,652 |
9.8% |
$300,000 |
$330,000 |
10.0% |
| Ventura |
876 |
896 |
2.3% |
$338,000 |
$360,000 |
6.5% |
| SoCal |
19,926 |
22,328 |
12.1% |
$278,000 |
$289,000 |
4.0% |
Source: DQNews.com
|
