Though Frenzy Is Over, Home Sales Still Brisk in South County
It takes longer to sell them these days, but despite continued rumblings of a slowdown, homes in South Orange County are enjoying brisk sales, officials of Grubb & Ellis Residential Brokerage Services said Wednesday.
The frenzy of the late 1980s--a period in which homes often sold for more than the original asking price as eager buyers bid up prices--has ended. But sales aren’t exactly slumping, said Milton E. Naylor, executive vice president and regional manager for the real estate firm.
“What we’ve got is just a return to a normal, healthy, realistic market,” he said.
Naylor and other Grubb & Ellis executives made their observations Wednesday as they unveiled the company’s annual market survey for the 14-community region south of the Costa Mesa Freeway.
The study, based on sales figures provided by the region’s boards of realtors, found that homes in the southern communities stayed on the market an average of 79 days during the last half of 1989, or 46% longer than during the same period in 1988.
At the same time, however, average sales prices continued to climb and sellers weren’t forced to slash prices in order to move their properties, Naylor said.
Home buyers “are not showing any resistance at all to prices,” provided that the asking price has not been artificially inflated, said Tom Golden, manager of Grubb & Ellis Mortgage Services.
“Buyers were doing a lot more shopping around,” said Jim Vermilya, district manager for Laguna Beach and the Dana Point-Laguna Niguel area. “We’ve seen an marked increase in buyer activity in the first quarter of this year.”
Although 79 days sounds like a long time, Naylor said, “throw out the superheated market of 1987 to 1989, and the recessionary market of 1981-82, and 79 days is about normal.”
Homes sold fastest in the Newport Beach area, staying on the market an average of only 55 days, even though the area had the second-highest average sales price--$543,030--of the communities surveyed.
San Clemente homes sold the slowest, taking an average of 121 days to sell. Capistrano Beach was the next slowest at 103 days, followed by Dana Point, 97 days.
The Laguna Beach-South Laguna area posted the highest average selling price, $625,841. Prices in that area rose the most of any of the communities, up 30% from the first half of 1989.
Capistrano Beach reported the next largest gain, with the average sales price increasing 25.7% to $352,000 during the last half of 1989.
Naylor warned against drawing conclusions from the figures, noting that trends develop over years, not months, and that average sales figures can be skewed by extremely large or small transactions and by the type of housing available on the market during any given period.
He said Grubb & Ellis has begun computing median sales prices--the point at which half the homes sell for more and half sell for less--and will compare medians rather than averages in future reports. Grubb & Ellis has nine retail offices in South County.
Citing California Assn. of Realtors’ figures for resale single-family homes, Naylor said the median sales price in all of Orange County appreciated at a rate of 18.6% in 1989, contrasted with 4.3% nationwide.
HIGHS AND LOWS IN SOUTH COUNTY HOUSING
Here are figures on pricing and market duration for selected Orange County communities during the period from July to December, 1989, as compiled by Grubb & Ellis.
Avg. Low High Median Avg. Days on City Price Price Price Price Market Capistrano Beach $150,000 $2,500,000 $333,000 $352,000 103 Costa Mesa 89,000 694,500 219,500 239,050 56 Dana Point 105,000 3,000,000 254,000 285,800 97 El Toro 79,000 500,000 202,000 185,000 64 Irvine 65,000 1,100,000 237,000 239,000 NA Laguna Beach 215,000 4,000,000 462,000 625,841 81 Laguna Hills* 65,000 1,500,000 240,000 224,000 77 Laguna Niguel 91,500 1,500,000 306,152 325,036 79 Lake Forest 120,000 590,000 259,000 276,000 58 Mission Viejo 97,000 1,300,000 238,000 223,000 68 Newport Beach 115,000 4,500,000 415,000 543,030 55 Rancho Santa Margarita 73,000 370,000 180,000 166,000 72 San Clemente 107,000 1,350,000 220,000 310,925 121 San Juan Capistrano 101,000 2,950,000 295,000 264,500 92
* Does not include Leisure World
Source: Grubb & Ellis