Average Price of Home Slips 6.4% in 1993 : Real estate: Market continues to favor buyers, report shows. ‘There is still a mismatch between supply and demand,’ analyst says.
The average selling price of single-family homes in Orange County declined 6.4% in 1993, a third straight year of decline, which signals that Orange County is still a home buyers’ market.
A report by TRW REDI Property Data, prepared for The Times Orange County, tracks home sales prices according to dollars per square foot, which automatically adjusts the market to help equalize the bigger homes that were popular in the late 1980s and the smaller homes that builders and resellers are putting on the market now.
The 1993 figures reveal that prices of existing and new homes are still in decline from the 1990 market high. In fact, prices fell more last year than in 1992, when prices only declined 3.3%.
“The drop in prices that we’ve had is significant. There is still further pressure on prices and I don’t see the prices stabilizing during 1994,” said Nima Nattagh, research analyst with TRW REDI. “There is still a mismatch between supply and demand, with many foreclosures and REO (real estate owned by lender) properties on the market.”
The average selling price for an Orange County single-family detached home was $132.90 per square foot during 1993. That compares to 1992’s average of $142 per square foot and the market high in 1990 of $152.2 per square foot.
As a result, an average 2,000-square-foot home in Orange County that would have sold for $304,400 in 1990 would sell for $265,800 today. The study, which tracks home prices since 1980, said home prices in Southern California doubled during the real estate boom years of the 1980s, but have fallen almost 13% since 1990.
In addition, the 13 cities surveyed in the study showed home sale price reductions during 1993, some posting a drop of almost 10%. The cities of Brea and Lake Forest posted the biggest drops: 9% and 7.9% respectively. Irvine at 2% showed the smallest price decline and Newport Beach saw its average home prices drop by 7%.
Although demand has stabilized, certain factors--such as the number of houses currently on the market--could drive prices down in certain cities, Nattagh said.
“I was surprised Brea had such a drop, because I would have thought affordable areas would have done better last year,” he said. “That leads me to think it was some kind of mismatch of supply and demand.”
Residential Square Footage Trends
The average selling price per square foot for new and resale homes has dropped nearly 13% since 1990, when it peaked at $152. Prices per square foot countywide and from various cities; 1993 figures are through November:
COUNTYWIDE 1980: $73 1981: 84 1982: 85 1983: 84 1984: 85 1985: 88 1986: 93 1987: 104 1988: 125 1989: 149 1990: 152 1991: 147 1992: 142 1993: 133
ANAHEIM 1990: $141 1991: 136 1992: 131 1993: 123
FULLERTON 1990: $153 1991: 150 1992: 142 1993: 138
GARDEN GROVE 1990: $146 1991: 141 1992: 137 1993: 127
HUNTINGTON BEACH 1990: $170 1991: 169 1992: 162 1993: 153
IRVINE 1990: $188 1991: 183 1992: 181 1993: 177
LAGUNA BEACH 1990: $245 1991: 302 1992: 299 1993: 277
LAKE FOREST 1990: $140 1991: 134 1992: 130 1993: 120
NEWPORT BEACH 1990: $249 1991: 300 1992: 285 1993: 265
ORANGE 1990: $151 1991: 145 1992: 142 1993: 131
SAN CLEMENTE 1990: $187 1991: 178 1992: 172 1993: 160
SANTA ANA 1990: $141 1991: 141 1992: 135 1993: 126
WESTMINSTER 1990: $146 1991: 142 1992: 137 1993: 129
Source: TRW REDI Property Data; Researched by JANICE L. JONES / Los Angeles Times
