Southern California home prices in January posted their smallest year-over-year gain in more than a year, as the housing market showed signs of slowing.
The median home price in the six-county Southland rose 18.4% from a year earlier to $380,000, the smallest increase since November 2012, research firm DataQuick said Wednesday. Sales also fell 9.9% compared to last year.
A total of 14,471 new and resale condos and houses changed hands last month -- the lowest level for a January since 2011, indicating tight inventory and declining affordability have handcuffed buyers.
"The economy is growing, but Southland home sales have fallen on a year-over-year basis for four consecutive months now and remain well below average. Why? We're still putting a lot of the blame on the low inventory," DataQuick President John Walsh said in a statement. "But mortgage availability, the rise in interest rates and higher home prices matter too."
Compared to December, the median price fell 3.8%. Because the median price is the point at which half the homes sold for more and half for less, such a drop from December isn't unusual, DataQuick says.
Buyers likely signed a contract around the holidays in order to close a sale in January. Many families back out of the market around the holidays, slowing the market and giving investors a larger role. Since, investors usually target more affordable homes, that can help bring the median price down.
The share of investor purchases inched up last month. Absentee buyers--mostly investors and some second-home purchasers--scooped up 27.5% of all homes sold in January. That's compared to 27.2% in December.
Sales fell from a year earlier in all six counties: Los Angeles, Orange, San Bernardino, Riverside, Ventura and San Diego. Los Angeles County saw the smallest decline, as buyers purchased 7.4% fewer homes last month.