All the talk of a slowdown in the local housing market seems to be just that — a lot of talk.
Defying some experts' predictions, home prices in Southern California reached new peaks in November while the pace of sales held steady for what is typically a slow time of year, a real estate service said today.
The median home price in Southern California — the price at which half of all houses sold for more, half for less — was $415,000 in November. That was up 1.2% from $410,000 in October, and up 23.5% from $336,000 for November 2003.
Although the number of homes sold dipped 0.6% to 27,459 compared to 2003, it was the third-strongest November for the five-county region, according to DataQuick's records.
"We're surprised," said John Karevoll, chief analyst for real estate monitor DataQuick Information Systems, which compiles monthly housing statistics. "We expected price increases to ease back and sales count to taper off, but they're about the same as they have been," he said.
With the exceptions of January and July, all months this year have set price records, DataQuick said.
A big reason for the housing market's endurance has been persistently low mortgage rates.
Despite the Federal Reserve raising short-term interest rates five times this year — the latest being today — rates for home loans remain near historic lows. As of today, the rate on a 30-year fixed mortgage was 5.68%. The cost of borrowing funds for adjustable-rate mortgages is lower.
The attractive rates have been a strong magnet for first-time buyers, Karevoll said. Indeed, the counties with the strongest rates of appreciation were San Bernardino and Riverside in the Inland Empire. Homes there, on average, are more affordable than other parts of Southern California.
Last month, San Bernardino's median price surged 34.6% to $284,000, and Riverside's jumped 29.1%. Sales in San Bernardino rose 18.7% to 4,065, while Riverside saw a 2.3% decline in sales.
Still, the Inland Empire remained "the motor" driving the local housing market, Karevoll said.
"The thing about any housing market," Karevoll said, "is that if people want to buy and they can buy, they will buy."