Investors Push Southern California Home Sales Higher in December

January 18, 2012 (Chris Moore)

Monthly sales of new and existing homes in Southern California surged in December, fueled by a record number of sales to investors according to real estate information provider DataQuick.

Sales in the Southern California region, which includes Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties, totaled 19,247 new and re-sale homes in December, up a whopping 14.0 from the 16,884 homes sold in November, but still 22.0 percent below the December historical average of 24,656 sold homes. Sales were 1.4 percent lower than in December of last year when 19,528 homes were sold.

Sales typically increase 13.2 percent from November to December and have varied from a low of 13,240 in 2007 to a high of 36,865 in 2003.

New home sales were at their lowest level on record for a December, falling 12.0 percent below last years levels, while sales of existing single-family homes and condos were 0.5 percent lower than in December of last year.

Sales transactions in the price ranges affected by the recent lowering of the conforming loan limits continued to fall for the third consecutive month. Transactions of all homes above $500,000 declined 20.9 percent from a year earlier while in Los Angeles and Orange County alone, where the conforming loan limits fell from $729,750 to $625,500, the number of sales transactions in that price range fell 76.2 percent compared to December of last year.

John Walsh, president of DataQuick, “Last year ended much the way it began, with pitifully low new-home sales, record investor activity, drum-tight credit, and lots of potential buyers and sellers just sitting tight. Some of the economic vital signs have improved lately and it’s sparked a renewed sense of optimism in housing circles. Coupled with incredibly low mortgage rates, it certainly suggests 2012 might offer the ‘rock bottom’ for pricing that many buyers and sellers have been waiting for. But the housing drama isn’t over. Credit conditions remain horrible, leaving many unable to take advantage of today’s improved affordability. And lenders still must decide the fate of scores of borrowers who aren’t making their mortgage payments.”

The median sales price paid for all new and re-sale homes in the Southern California region in December returned to the 2011 low-point of $270,000. The median price was 1.8 percent lower than the $275,000 price posted in November and 6.9 percent lower than in December of 2010 when the median price was $290,000.

The highest median sales price for homes in the region during the current housing cycle’s peak was $505,000 in mid-2007 while the lowest was $247,000 in April 2009.

The median sales price has declined year-over-year for the past ten months and has declined or remained unchanged since December 2010.

Distressed properties accounted for 52.5 percent of the re-sale market in December, up from 51.3 percent in November, with foreclosure re-sales accounting for 32.5 percent of the market, up from 31.7 percent in November, while short sales made up an estimated 20.0 percent of re-sales, up from 19.6 percent the previous month.

Cash buyers accounted for 29.0 percent of the homes sold for the month, up from 28.9 percent in November, paying a median price of $202,500 for their purchases.

Absentee buyers, usually investors and vacation home buyers, accounted for a record high 26.4 percent of all sales, up from 24.8 percent in November and paying a median price of $200,000 for the homes they purchased.

Tags: DataQuick, Southern California, new homes, re-sale homes, median price, home sales, investors, absentee buyers

Source:
DataQuick