O.C. Home Prices Show Fastest Rise in Country

Orange County home prices rose 17.9%--the fastest level in the nation--in the second quarter, according to a new real estate report.

The rate was double the national average in the April-June period, according to First American Real Estate Solutions, which conducted the study. Six other regions of California finished in the top 10.

The report, which gauges sales in 37 cities across the country, measures the price of homes that have been sold at least twice. It does not report a median price for each market, but rather the rate of appreciation.

Of the top 10 metropolitan areas with the fastest rate of appreciation, six were in California and all showed double-digit growth.

Oakland was second, at 17.2%; San Diego, third, at 16.9%; San Francisco, fourth, at 14.8%, and San Jose, fifth, at 14.5%. Los Angeles came in eighth, at 11%.

New York ranked sixth, Seattle seventh, Boston and Denver 10th.

First American analyst Nima Nattagh said Orange County’s home resales have recovered all but 2.5% of their value from the market’s last peak, in 1990.

He attributed rising prices to the county’s economy and an “acute imbalance” of demand outstripping housing supplies.

He expects Orange County to remain among the nation’s appreciation leaders over the second-half of the year.

The region’s performance wasn’t surprising given its economic gains, said Bruce Norman, president of First Mortgage Corp. in Diamond Bar, who also heads the California Mortgage Banker’s Assn.

“But it’s bittersweet news,” he said. “It’s good for people selling their homes and for the economy, but it’s bad news for those trying to get into the housing market.”