Rise in Existing-Home Values Is Slowing

In another sign that the Southland’s once-sizzling housing market is cooling, a survey conducted by a real estate research group says appraised values of sample existing homes are rising at their slowest rate in the last five years.

The biggest slowdowns were recorded in Orange and Ventura counties, according to the semiannual survey conducted by the Real Estate Research Council of Southern California. The council is a nonprofit organization headquartered at Cal Poly Pomona.

Estimated values in Orange County rose an average 18% from October, 1988 to October, 1989, down from the 27% annual appreciation rate logged from April, 1988 to April, 1989.

Values in Ventura County rose at a 14% annual clip in the October-to-October period, less than half the 29% yearly rate recorded six months earlier.

“The housing market is cooling, but it’s still pretty strong,” said Michael Carney, the economist and Cal Poly professor who conducted the survey.

“Home prices are still rising. It’s just that they’re not rising as fast as they were before.”

Results of the survey are based on the appraised value of 214 existing homes scattered across seven Southern California counties.

The same homes are appraised every six months, regardless of whether they are sold, in order to track general price movements. New homes are excluded from the survey.

Estimated values in Los Angeles County were up 24% from the year-ago survey. Values in the East San Gabriel Valley-Pomona subregion were up 32%; in the San Fernando Valley, 27% and the North Central-Pasadena area, 25%.

Values have risen an average 24% in the Westside-Santa Monica market and in Southeast Los Angeles over the past year.

Appraised values rose fastest in San Bernardino County, a huge area where values surged 29% from October, 1988 to October, 1989, the survey said. That was nearly three times the appreciation rate recorded a year earlier, according to the report.

Values in Riverside County rose a healthy 23% over the past year.

“Prices in San Bernardino and Riverside are catching up with the rest of Southern California,” Carney said. “Demand there has been helped by all the people who want to buy a house, but can’t afford a home in Los Angeles or Orange County.”

The survey found that values in San Diego County are up 24% from a year ago, while values in Santa Barbara County are up 18%.

Overall, values in the seven-county area rose an average 8.1% over the past six months and are up 22.9% from a year ago, the report said.