Rates, Prices Help Lift State Home Sales : Real Estate: In the Los Angeles area, sales of houses rose 38.3% from February, and the median home price climbed 5.3% to $210,410.
Aided by lower mortgage rates and stable prices, purchases of single-family homes in March posted double-digit increases in most areas of California as sales climbed for the second month in a row, the California Assn. of Realtors reported Wednesday.
“The March sales statistics verify that the California housing market is bouncing back,” said association President Mack Powell, a real estate broker in Sacramento.
On an annualized basis, about 427,550 existing single-family homes were sold during March, up 4.3% from February’s rate of 410,030 but 14.5% lower than in March, 1990. (The annualized figure is the association’s projection of year-end purchases if sales continue at the March pace. No figures on actual home sales were available from the realtor group Thursday.)
In the Los Angeles area, home sales rose 38.3% from February, and the median home price climbed 5.3% to $210,410. In Orange County, home sales jumped 53.3% over February. The median price edged up nearly 1% to $238,600.
Economists caution that the state’s housing market is months away from a full recovery because consumer confidence remains fragile, and the economy continues to stumble.
The California unemployment rate, for instance, jumped to 7.7% in March, highest in almost six years. The rate is expected to go higher in the wake of the Air Force’s rejection Tuesday of Northrop Corp.’s bid to win a $72-billion fighter jet program.
Northrop, which intended to develop and produce the aircraft in Southern California, will lay off between 200 and 400 employees as a result of the decision. Lockheed, which won the contract, said it will do much of the fighter work in Georgia.
The outlook for interest rates is not promising either, experts say.
Federal Reserve Board Chairman Alan Greenspan indicated in testimony before the Senate Banking, Housing and Urban Affairs Committee this week that he is not considering lowering interest rates further despite his belief that the economy is worsening.
“From all indications, I don’t think we are completely out of the housing slump,” agreed Bob Edelstein, co-director of the Center for Real Estate and Urban Economics at UC Berkeley.
Association officials, however, hold a more optimistic interpretation of the latest economic developments.
“Unemployment is a lagging economic indicator, while housing is a leading indicator,” said Leslie Appleton-Young, the association’s vice president of research and economics. “We’ve seen a tremendous amount of demand for housing since the end of the Gulf War.
