REAL ESTATE: Home prices up again – by 28 percent BY DEBRA GRUSZECKI, STAFF WRITER January 14, 2014; 03:21 PM Home sale prices across Southern California were poker-hot in December, the latest real estate information report from San Diego-based DataQuick suggests. Median prices jumped 28.9 percent in San Bernardino to $232,000 last month. And Riverside Country tracked along with its Southern California counterparts with a new $280,000 median that reflected a 21 percent gain over December 2012. For Inland homeowners who have long been underwater on home equity — meaning they owe more than the house is worth — December was the photo finish to a full year of heady price gains. But even as Southern California recorded its highest median sale price since 2007, the 22 percent gain took the spark out of sales. The 18,415 total homes sold in December, including existing and new homes and condominiums. fell 9.2 percent from 20,274 sales in December 2012 for the Southern California region. That’s 24 percent below the average number of sales. Typically, 24,254 sales close in the six-county area in December. The biggest December home sale declines were measured along the coast. Sales dropped 17.5 percent in San Diego County and fell13.3 percent in Los Angeles County. Ventura County had a time of it, too, with sales plunging 11.7 percent. Orange County held its own, as did San Bernardino County, both counties of which netted sales gains of less than 1 percent. Riverside County sales were 5.5 percent lower than December 2012. What’s to blame for this December of extremes? “Pitifully low inventory is the main culprit,’’ DataQuick president John Walsh said in a statement. Also at work putting the squeeze on sales is a slowdown in investor activity and the decline in distressed property in the marketplace. Short sale activity — transactions where the sale price falls short of what was owed on the property — was down 26 percent from December 2012. Foreclosure re-sales, which are homes taken back by the lender in the previous 12 months, shrunk to 5.8 percent of the total sales. Five years ago, 56 percent of all real estate sales in Southern California involved foreclosed homes. Mike Novak-Smith, a broker with Re/Max Results, Moreno Valley, said market prices have been pushed up so high the investors are pulling back. “They were part of the price run-up,’’ he said. “Now, a lot of the investors have pulled out.” Writing guidelines for home mortgages also tightened. “It’s becoming more difficult for owner-occupants to close the deal, so if you combine the fact that prices are going higher with lending guidelines that are becoming more restrictive, it slows the market down,’’ Novak-Smith said. Walsh said the jump in home values over the last year suggests more people will put their houses on the market. That would ease the inventory crunch. But that’s not what played out here in 2013, as Inland Southern California homeowners enjoyed a monthly diet of home sale price appreciation of 20 percent and more. As prices rose, inventory became constrained in unique ways. Homeowners with equity stood back to watch the price gains play out. Investors backed away when the buy-prices stopped penciling out. Banks began to delay closing escrow on short sales, as appraisal reports touted monthly gains. First-time homebuyers continued to feel the squeeze. The DataQuick numbers seem to reflect the changing dynamics, with the number of Southland homes selling at prices below $200,000 falling 45.6 percent year-over-year. Investor purchases fell to 27.7 percent, down from 35.8 percent in December 2012. pe/business/business-headlines/20140114-real-estate-home-prices-up-again--by-28-percent.ece
Posted on: Fri, 17 Jan 2014 18:27:47 +0000
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