Socal housing market gains strength

Headline numbers are part of the story - L.A. County home sales were up 20 percent in August compared with a year earlier (Southern California sales rose 14.2 percent), while the median price of $335,000 was up 6.3 percent. But what stands out in the Dataquick numbers is the stronger presence of higher-priced properties. Southern California sales between $300,000 and $800,000 - the common range for move-up buyers - rose 23.4 percent from a year earlier, and sales over $800,000 increased 19.3 percent. Foreclosure sales accounted for just 19.2 percent of the market, down from 32.4 percent a year earlier. In other words, the market is getting back to more traditional sales and pricing patterns. From press release:

"August was the strongest month for home sales so far this year, and the strongest for an August in six years. That's really saying something given the drop in low-end sales, especially foreclosure resales. Much of the pickup in activity reflects a continuation of trends we've seen for months, like the unleashing of pent-up demand in move-up markets and high levels of cash and investor buying. It will be interesting to see at what point cash purchases, which still account for close to a third of all sales, start to fade. In the meantime, strong seasonal forces should be kicking in now. Absent an unusual surge in demand this fall, sales will taper off over the next few months," said John Walsh, DataQuick president.

Today's actions by the Federal Reserve are certain to keep down mortgage rates - and that should provide a greater argument for buying a house. They're already very low, with 30-year fixed running 3.375 percent. It's worth noting that Socal buyers were still paying cash for nearly a third of August home sales, way higher than historic norms.

AUGUST HOME SALES (% change from August 2011)
Los Angeles 7,917 +20.00%
Orange 3,337 +20.00%
Riverside 3,520 -3.40%
San Bernardino 2,705 +3.20%
Ventura 978 +27.80%

AUGUST MEDIAN PRICE (% change from August 2011)
Los Angeles $335,000 +6.30%
Orange $445,000 +6.00%
Riverside $210,000 +10.50%
San Bernardino $168,000 +12.00%
Ventura $365,000 +2.80%

Source: DQNews.com