O.C. Median Home Price Hits Record High: $245,000
Orange County home prices, rising at an even faster pace than in the robust summer months, hit an all-time median high of $245,000 in September, as the typical home gained 8%, or $18,000, in value from a year ago.
It was the 28th consecutive month that housing prices have surpassed year-earlier numbers, according to Acxiom/Dataquick Real Estate Systems Inc., a La Jolla-based firm that tracks Southland home prices. Given Orange County’s strong job growth, home prices could continue their rise over the year and beyond, said John Karevoll, an Acxiom/Dataquick analyst.
“This could last for a very long time, given the economic fundamentals here,” said Karevoll, who added that prices rose throughout the county in September, from condominiums inland to coastal mansions.
Indeed, if prices continue to gain 8% a month through year’s end, the median price of an Orange County home--in which half sell for more, half for less--would rise to $255,000.
Analysts said high demand continues for homes, but not to the point that multiple offers have become widespread or that buyers have been willing to pay any price in order to purchase a home. They described the market as active, but steady.
“It is a good market, a strong market, but it’s not the frenzy we saw in February 1998, when people stood in line and offered cash to change positions to buy a home,” said Barbara Stowers, sales and marketing vice president at Taylor Woodrow Homes Inc. “There’s more housing available for people.”
September marked the second time this year that the median home price hit an all-time high, eclipsing May’s $241,000, which was up $4,000 from a year earlier.
With consumers buoyant over the rising stock market, historically low interest rates and the region’s economic growth, new homes recorded a 40% jump in sales, producing the strongest September on record.
A sudden burst in prices so late in the annual housing sales cycle means that prices almost certainly will reach new heights when annual figures are tallied at year’s end.
Home prices per square foot--considered a more accurate measure of the market--rose 8.2% in September, to $159.60. That’s within $1 of the all-time high. The indicator has recorded double-digit increases in seven of the nine months this year.
Despite higher prices, buyers still purchased 4,450 homes in September, the strongest September on record. Overall, sales grew by 2.7% as condo resales rose more than 7%, helping offset a smaller decline in home resales compared to a year ago.
Much of the market’s new housing was provided by three large, master-planned communities that opened in South County over the summer: Northpark in Irvine, Talega and Ladera Ranch. All have reported brisk business.
Builders say that the sales pace has slowed in recent weeks. Homes now take 60 to 90 days to sell, up from 35 to 40 days earlier this year. “People aren’t making decisions as quickly,” said Steve Wolpin, vice president of sales and land acquisition, Lennar Homes of California.
Buyers who cannot afford single-family homes increasingly turn to condominiums. That was reflected in the September housing report, in which the median price of a condominium recorded an all-time high of $164,000, up 10% from a year ago.
Pablo Velasquez, a broker at Advance Realty in Santa Ana, said that buyers who won’t settle for a condominium are moving to the Inland Empire, where home prices are much cheaper.
“But a lot of people are readjusting their purchase from a single-family home to a townhouse or a condominium,” he said.
The same pattern holds true for the high end of the market, where buyers who can’t afford pricey detached homes are willing to buy an upscale condo.
“I’m having brisk sales in the townhome market in the $300,000-plus range in the last 45 days and each one sold for more than the last comps,” said Chuck Bucimi, an agent at First Team Real Estate Inc.
In the Huntington Harbour project in Huntington Beach, Bucimi said he could sell at least half a dozen more condos priced between $350,000 and $475,000, if they were available.
Chapman University economist Esmael Adibi believes that Orange County’s economy will produce fewer new jobs next year, which will cause home prices to rise by only 5% to 6%.
“It’s not going to last forever,” Adibi said. “The housing market is extremely strong, no question about it, and things will continue to be strong, but not as much as we’ve experienced in 1998 and early 1999.”
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Prices Peak
A surge in the sale of new homes--all of which sold for more than $300,000--pushed Orange County’s median home price up 7.9% in September, to an all-time high of $245,000. Here’s a look at the market.
Sales by segment
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Sept. 99 % change from yr ago Resales 2,767 -4.0 Condos 1,143 +7.6 New homes 540 +39.5 Total 4,450 +2.7
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Prices by segment
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Sept. 99 % change from yr ago Resales $260,000 +8.3 Condos 164,000 +10.4 New homes 343,000 -1.0 Median 245,000 +7.9
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Where it’s hot
Top 5 zip codes for price appreciation
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City Zip Median % change from year ago Buena Park 90621 $288,500 88.6 Santa Ana 92701 146,500 54.2 Tustin 92782 374,000 49.6 Fullerton 92831 230,000 46.9 Corona Del Mar 92625 750,000 37.5
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Where it’s not
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City Zip Median % change from yr ago Tustin 92780 149,250 -30.3 Orange 92869 210,000 -18.9 Yorba Linda 92887 381,500 -18.5 Huntington Beach 92646 $241,000 -16.2 Huntington Beach 92648 300,000 -16.2
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Source: Acxiom/Dataquick
