September 5, 2012 (Chris Moore)
Monthly sales of new and existing homes in Southern California declined for a second consecutive month during July but were still higher than last year’s tally according to real estate information provider DataQuick while home prices continued to see steady improvement.
Sales in the Southern California region, which includes Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties, totaled 20,588 new and re-sale homes in July, a 6.7 percent decline from the 22,075 homes sold in June but still 13.8 percent higher than the 18,090 homes sold in July of last year.
Home sales in the area typically decline about 7.3 percent between June and July and were 19.4 percent below the historical average for the month of July. Year-over-year, home sales have increased for the last seven months and 11 out of the last 12 months.
Cash buyers accounted for 31.0 percent of the homes sold for the month, down from a revised 32.3 percent the previous month. Cash buyers paid a median price of $235,000 for their purchases, unchanged from the previous month.
Absentee buyers, usually investors and vacation home buyers, accounted for 27.1 percent of all sales in July, down from a revised 27.3 percent in June, and they paid a median price of $235,000 for the homes they purchased, up from $225,000 the previous month.
The median sales price paid for all new and re-sale homes in the Southern California region increased 2.0 percent in July to $306,000 from $300,000 in June. The median price a year ago was also $283,000.
It was the fourth consecutive month that year-over year home prices have increased in the Southern California area after 16 months of declines.
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 July 2009.
John Walsh, president of DataQuick, stated, “Even adjusting for changes in market mix, there’s growing evidence prices have crept up in areas where more demand has met a shrinking number of homes for sale. But we’re approaching the peak of the traditional spring-summer home-buying season. Whether these trends hold into the fall and winter isn’t clear. If they do, then logically the number of homes on the market would eventually rise to meet the demand. More owners will be interested in selling, knowing their homes are likely to fetch a higher price, and more people will shift from a negative to at least a slightly positive equity position, enabling them to sell. Home builders could rev up operations and lenders could push more distressed properties onto the market sooner. It would tame any price appreciation.”
Distressed properties accounted for 39.7 percent of the re-sale market in July, down from 42.1 percent in June, with foreclosures accounting for 21.0 percent of the re-sale market, down from 24.4 percent in June, while short sales made up an estimated 18.7 percent of re-sales, down from 17.7 percent the previous month.
Distressed property sales were at their lowest level since January of 2008 as foreclosure re-sales have fallen by more than half since their high of 56.7 percent of all re-sales in February 2009.
Tags: Southern California real estate, new homes, re-sale homes, median price, home sales, investors, absentee buyers