Home prices climb as inventory remains limited

homesale2.jpgThis is encouraging news, even though Southern California sales for September actually fell 1.6 percent from a year earlier and 20.4 percent from August, according to Dataquick. Part of this has to do with the calendar: August had 23 business days on which home sales could be recorded while September had only 19. But another more significant factor is the fewer number of lower-priced sales, including foreclosures (notice the sales drop in Riverside and San Bernardino counties). The number of homes that sold for between $300,000 and $800,000 rose 11.5 percent year-over-year, and sales over $800,000 - a segment that had been in the toilet for years - rose 5.2 percent. Meanwhile, Socal prices keep going up - again due to lower sales of entry-level homes - with a September median of $315,000, up 12.5 percent from a year earlier and 1.9 percent from August. L.A. home sales were unchanged from a year earlier, but the median price of $340,000 was up 9.7 percent. From press release:

"The latest stats suggest unbelievably low mortgage rates and modestly higher consumer confidence continue to put pressure on a supply-starved housing market. We can't stress enough, though, that the median sale price and other price measures reflect more than just rising home values. There's been a major change in market mix, meaning fewer low-priced sales, fewer foreclosures re-selling, and more sales in middle and upscale markets," said John Walsh, DataQuick president. "Assuming this year's modest upward trend in pricing holds," he said, "we'll eventually see the market begin to re-balance with more supply, though that could take many months. More and more potential move-up buyers who do have equity will be thinking about timing their next purchase to maximize the advantage of super-low rates and relatively low prices. As more potential sellers get off the fence, or no longer owe more than their homes are worth, we'll see the inventory of homes for sale rise. That's going to limit price appreciation."

SEPTEMBER HOME SALES (% change from September 2011)
Los Angeles 6,188 0.0%
Orange 2,677 +6.7%
Riverside 3,303 -11.6%
San Bernardino 2,044 -10.9%
Ventura 816 +5.7%

SEPTEMBER MEDIAN PRICE (% change from August 2011)
Los Angeles $340,000 +9.7%
Orange 2,677 +6.7%
Riverside $212,500 +11.3%
San Bernardino $170,000 +13.3%
Ventura $374,750 +7.4%

Source: DataQuick, DQNews.com

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Mark Lacter
Mark Lacter created the LA Biz Observed blog in 2006. He posted until the day before his death on Nov. 13, 2013.
Mark Lacter, business writer and editor was 59
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