Southern California home prices keep rising, and sales jump
Southern California home prices and sales rose in November compared with a year earlier, according to a report released Tuesday.
The six-county region’s median price reached $465,000 last month, up 5.9% from November 2015, real estate data firm CoreLogic said. Sales soared 24.1%.
The strong sales jump, however, happened largely because new lending regulations last year delayed many deals that otherwise would have closed in November 2015, CoreLogic analyst Andrew LePage said.
“The main reason Southern California home sales in November shot up so sharply ... is the artificially weak sales recorded in November 2015,” LePage said in a statement.
Median prices climbed, year-over-year, in all six counties.
In Los Angeles County, the median price rose 8.4% to $530,000; in Orange County, 5.9% to $660,000; in Ventura County, 2.9% to $525,000; in San Bernardino County, 5.7% to $295,000; in Riverside County, 6.8% to $340,000; and in San Diego County, 5.6% to $495,000.
The Southern California median home price has now risen, year-over-year, every month for more than four years. The strong gains have some in the real estate industry wondering how much further prices can climb.
Housing values’ rise has far outpaced income growth in recent years, and mortgage interest rates have risen since the Nov. 8 presidential election, driving up monthly payments.
The average rate on a 30-year fixed mortgage was 4.3% last week, up from 3.54% in the week before the election, according to government-backed mortgage buyer Freddie Mac.
Many economists expect prices to keep rising in 2017, but more slowly than in previous years as families have a harder time affording a home.
There are some signs that slowdown could be happening already.
Although the median price jumped in November compared with a year earlier, it hasn’t changed much on a month-over-month basis since June, when it was also at $465,000. In June, that median price was a nine-year high.
Although that lack of movement in prices could indicate a softening market, it’s not unusual for the median to peak for the year in summer given heavy seasonal demand.
A better gauge of the market’s trajectory will come during the traditionally busy spring home-buying season next year.
November’s data also are a poor way to gauge any effect of mortgage rates’ post-election climb. That’s because CoreLogic tracks closed sales, and most sales that closed last month likely opened escrow before the election.
In other housing news, the closely followed Case-Shiller index was also released Tuesday. That index gives a better, albeit delayed, look at home values. It compares the latest sales of detached houses with previous sales and accounts for factors such as remodeling that might affect a sale price over time.
In Los Angeles and Orange counties, prices rose 5.7% in October compared with a year earlier, the index showed.
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