Home Prices May Be Leveling Off
When it comes to Southern California real estate, there’s the big picture and then there’s the neighborhood-by-neighborhood view.
From a macro standpoint, the region’s housing prices continue to appreciate at a double-digit pace from last year. In October, Southern California’s median home price surged 23.1% year over year to a record $410,000, DataQuick Information Systems reported Tuesday.
It was the third consecutive month, and 10th out of the last 12 months, that the median price -- the point at which half of the homes and condominiums sold for more and half for less -- hit an all-time high.
Yet, the data also showed that prices were leveling off in the more urban parts of the five-county region. For instance, Orange County’s median has edged 2% lower since May; Los Angeles County’s, 1.2% since June; Ventura County’s, 4% since September.
At the neighborhood level, “there is a discrepancy between the statistics and what we’re experiencing out there in the marketplace,” real estate agent Tom Pelton said.
In the north and central Orange County communities where he works, homes priced below $700,000 are moving quickly, Pelton said. With higher-priced homes, buyers are being tougher negotiators.
In many cases, sellers still are assuming that they can get more for their house “than the last sale in the neighborhood,” said Pelton, an agent for First Team Real Estate. At the same time, more buyers are pushing for reductions to listing prices.
One indicator that analysts are closely watching is number of homes sold, which fell 13.3% to 28,189 from a year earlier, which was the strongest October in 15 years. Homes in pricier areas experienced the biggest declines in sales volume compared with October 2003.
Transactions dropped 25.6% in Ventura County, and fell 24.6% in Orange County to their lowest October level since 1991, DataQuick reported. Although both counties saw 20%-plus gains in year-over-year appreciation, the median price in each county is off the record highs reached earlier this year. Ventura’s median was $518,000 in October; Orange County’s, $532,000.
In San Diego County, sales fell 8%. The median price was $489,000, up 26% from a year ago and 1.9% from September.
“It’s starting to look like prices in many of the more expensive neighborhoods have leveled off or have come down slightly from a summer peak,” said Marshall Prentice, DataQuick’s president. Meanwhile, homes in mid-market and entry-level communities continue to see advances in prices.
In San Bernardino County, the median price rose 30.4% to $266,000, as sales dipped 1.2% from a year earlier. In neighboring Riverside County, the median price rose 29.4%, to $339,000, as sales fell 3.9%.
October results for Los Angeles County, which accounts for 35% of sales in the region, were reported last week. They showed a median price of $409,000, up 23.2% from a year earlier, on a 17.8% decline in homes sold.
Last month’s sales decline was less severe than it appeared, given that there two fewer business days for which transactions could be recorded compared with last year, DataQuick analyst John Karevoll said. “The market is not softening by much, which many expected,” he said.
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Higher and lower
Sales and median prices for new and resold homes in October Percent Percent Number change Median change of homes from price from County sold Oct. ’03 (thousands) Oct. ’03
San Bern. 3,941 -1.2% 266 +30.4% Riversd. 5,070 -3.9 339 +29.4 Ventura 1,203 -25.6 518 +29.2 San Diego 4,758 -8.1 489 +26.4 L.A. 9.709 -17.8 409 +23.2 Orange 3,508 -24.6 532 +20.9 ______ So. CA. 28,189 -13.3 410 +23.1
Source: DataQuick Information Systems
