Sales of Existing Homes Fell 21% in 1990; Prices Flat : Housing: The slowdown hit coastal areas hard, but Inland Empire prices were up.
Pummeled by a weak economy, the Persian Gulf crisis and declining consumer confidence, the housing market in Orange County and the rest of California cooled markedly last year, the California Assn. of Realtors said Wednesday.
Sales prices of existing homes were flat in Orange County last year, as the number of homes changing hands dropped by more than 20%.
The survey of Orange County excludes new homes, a much smaller portion of the housing market, and attached housing such as condominiums. It is based on reports from seven of the county’s local Boards of Realtors.
The median price of existing single-family houses sold in the county during 1990 was $242,360. That was up 0.3% from 1989’s $241,710. Across the state, home prices dropped 0.8% last year, to $194,010 from $195,650 in 1989.
Generally, home prices in more expensive coastal areas fell slightly or stayed flat, while home prices in less expensive inland areas rose, the trade association said.
It said the slight drop in prices statewide in 1990 represented a cooling of the frenzied housing market and the double-digit price increases of both 1988 and 1989, when the median price of a house in California increased by $53,000. California housing is among the most expensive in the nation, and only about 20% of families can afford a median-priced home.
In the Los Angeles area, the median home price dipped 1% to $212,770 as home sales declined 20.5%. The median home price in the San Francisco Bay Area slipped 0.6% to $259,290, and sales of existing single-family homes fell 21.6%.
The median home price in the Central Valley jumped 17% to $113,940 last year as sales of existing single-family homes there edged up 1.9%. In the Riverside-San Bernardino area, the median home price increased 6.4% to $132,130, but home sales in the region declined 12.6%.
Sales of homes in Orange County, meanwhile, were estimated to have fallen 21.7% last year. Exact figures for the county aren’t available, the trade association said.
Across the state, sales fell 17.1% last year to 446,370 houses from the 538,120 sold in 1989.
“Last year’s sales decline was expected, considering the extremely strong housing markets that California enjoyed in 1988 and 1989--the two best years of home sales in the decade,” said Mack Powell, president of the Realtors group.
The inland regions’ sales decline was not as steep as the more expensive coastal areas. And sales actually increased in the Central Valley and northern wine country regions.
The trade association also blamed last year’s slowdown in the housing market on a weakened national economy and a subsequent decline in consumer confidence.
Citing an oft-repeated argument, the association said the state’s housing market won’t drop much further because California’s economy is stronger and more diverse than depressed regions such as Texas and New England.
So the slowdown “should begin to turn around by the second half of 1991,” said Leslie Appleton-Young, an economist for the trade association.
THE SOUTHLAND HOUSING MARKET Sales of single-family homes were off significantly from a year ago throughout the region in 1990 while prices remained essentially flat.
Pct. Pct. Chg. Median Price * Change in Sales Region 1990 1989 in Price ‘89-’90 Los Angeles $212,770 $214,830 -1.0 -25.6 Orange County 242,360 241,710 0.3 -21.7 Riverside/San Bernardino 132,130 124,120 6.4 -12.6 San Diego 183,210 181,920 0.7 -6.9 Ventura 238,790 247,660 -3.6 -30.0
* Figures are based on reports from local Boards of Realtors on closed escrow sales of single-family, detached homes. The median prices do not reflect the cost of a standard home and may be influenced by changes in the characteristics and size of homes actually sold.
Source: California Assn. of Realtors
