Tight credit and consumer worries over the Gulf War more than offset lower mortgage rates in January, triggering a 4.3% decline in home resales in California last month and 7% nationwide, two real estate trade groups reported Wednesday.
The decline means that the sales rate in California is 31.1% slower than it was a year ago when the state’s slowdown was already under way.
Meanwhile, in a separate report, the Commerce Department reported Wednesday that the economy contracted at a 2.0% rate in the final quarter of 1990, slightly less than the previously estimated 2.1%.
The main reason for the revision was that imports fell more sharply than originally estimated as the economy weakened. But exports were relatively strong, so the national trade performance was better than reported a month ago.
Consumer spending fell only 2.9% from the third-quarter levels, the Commerce Department said, compared to earlier estimates of 3.1%.
The home sales report from the California Assn. of Realtors showed steep month-to-month declines in most areas of the state, with the expensive Ventura County region north of Los Angeles plunging 32.9% for the biggest drop.
Sales in the Northern California wine country were off a whopping 62.6% on a year-to-year basis.
The National Assn. of Realtors, in its monthly report, said January’s sales of existing single-family homes were 2.91 million units on an annual basis, down from 3.13 million units in December.
The January rate was down 16.1% from a year ago, when sales were 3.47 million units.
January’s median price of an existing, single-family California home was $192,690, down 0.1% from December and 1.2% below the year-ago median price of $194,950.
The median represents the level at which half the homes sold are more expensive and half are less expensive.
The national median price for single-family homes in January was $94,200, up $2,500 from December, but down $1,000 from January, 1990.
Sales declines were slight in Orange County, 4.6%, and the San Francisco Bay Area, 2.7%. But hefty declines came in several other areas: Riverside/San Bernardino, 13.5%; the Central Valley, 15.4%, and Los Angeles, 16.1%.
Los Angeles sales were also off a steep 41.1% from January, 1990.
Although the revision from the previous estimate was small, economists said they were encouraged by new data in the report.
“There is a significant shift in the mix,” said Stephen Roach, economist at Morgan Stanley. “It sows the seeds for a revival.”
O.C. PRICES RISE
Sales of single-family homes continued to slump last month, but the median price rose 3.3% from December, 1990. D6