County Home Sales Continue Rally, but Prices Drop : Real estate: Buyers are taking advantage of ample inventory, low interest rates and greater affordability.

Sales of single-family homes in Orange County were up more than 20% from a year ago, a sign some realtors said is proof that buyers are returning to California’s coastal communities looking for bargains.

The California Assn. of Realtors reported Tuesday that sales of existing homes here in May were up 20.5% but that sellers weren’t getting what they might have if they had sold a year ago. The region’s median price for a home last month was $240,390, down 6.5% from $256,990 in May, 1990.

“You are having a shift back to the coastal areas as people are taking advantage of the price softness . . . the very favorable interest rates and the ample inventory of homes on the market,” said Leslie Appleton-Young, the realtor association’s vice president of research and economics.

Tuesday’s report marks the third consecutive monthly gain in sales in Orange County.

Sales from April to May were up 4.7%, but the median price was essentially unchanged.

Statewide, sales were up 9.2% from a year ago, marking the first year-to-year increase since April, 1989. The median price for a California home hit a high of $207,840, up 6.4% from $195,280 a year ago.

“It was a very, very strong showing,” said Appleton-Young. “It was a little surprising.”

She attributed the surge in sales to a “huge, pent-up amount of demand that was released after the (Persian Gulf) war.”

Meanwhile, condominiums in California enjoyed a slight appreciation in price, climbing nearly 1% from a median of $146,060 last year to $147,440 in May. Sales on a year-to-year basis were down 2.6%.

Some economists, including Appleton-Young, believe that the sales surge in Orange County and surrounding areas may not last.

“I think you are going to see a leveling off in anticipation of an improvement in the California economy,” said Appleton-Young. “California has obviously been hit by the big drop in construction employment, reduction in aerospace jobs and problems with the drought.”

Nevertheless, the association expects the market to pick up again later this year.

“We do see a comeback by the end of the third quarter,” Appleton-Young said.

Home Resales May’s sales of existing Orange County homes continued an upward trend begun in April. Home resales were up 4.7% from April on a non-seasonally adjusted basis and increased 20.5% from May , 1990. The median resale price of single-family detached homes held steady at just over $240,000, a level 6.5% lower than the all-time peak of $256, 990 reached in May, 1990. Median Price In thousand of dollars: Dec. 1989: $248,664 May. 1991: $240,390 Sales Volume In percentage change from same month in prior year: Dec. 1989: -26.2% May. 1991: 20.5%