Southland Median Home Sale Price Climbs Again

The median price paid for a Southern California home hit a 56-month high in March, rising 23.4 percent from a year earlier as the impact of foreclosures continued to fade and sales of mid- to high-end homes shot up. Total sales were the highest in six years for a March despite a sharp drop in sub-$300,000 deals, a real estate information service reported.

A total of 20,581 new and resale houses and condos sold in Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties last month. That was up 29.1 percent from 15,945 sales in February, and up 3.1 percent from 19,953 sales in March 2012, according to San Diego-based DataQuick.

Sales normally jump between February and March, with that month-to-month gain averaging 36.4 percent since 1988, when DataQuick’s statistics begin.

Last month’s sales were the highest for the month of March since 21,856 Southland homes sold in March 2007, but they were still 15.1 percent below the March average of 24,254 sales. The low for March sales was 12,808 in 2008, while the high was 37,030 in March 2004.

The median price paid for all new and resale houses and condos sold in the six-county Southland was $345,500 last month, up 8.0 percent from $320,000 in February and up 23.4 percent from $280,000 in March 2012. Last month's median was the highest since July 2008, when it was $348,000.

The median has risen on a year-over-year basis for 12 consecutive months, and those gains have been double-digit – between 10.8 percent and 23.5 percent – since last August.

“It’s remarkable how much the housing scene has changed in a year. At this point in 2012 there were still plenty of folks sitting on the market’s sidelines, waiting to be sure the recovery was real. But gradually the psychology shifted as the economy picked up steam and mortgage rates fell to historic lows. We’re seeing the release of a lot of pent-up demand, especially in the middle and higher-priced neighborhoods where activity had been sluggish for years,” said John Walsh, DataQuick president.

“Price measures continue to rise for two simple reasons,” Walsh added. “First, demand for homes has risen at a time when the available supply is unusually low. Prices have had nowhere to go but up in many areas. Second, the gains are especially high right now because of the change in market mix: Sales of lower-cost homes have fallen at the same time activity in the higher price ranges has risen.”

It appears that better than half of last month’s 23.4 percent year-over-year gain in the Southland median sale price reflects rising home prices, with the balance reflecting the change in market mix.

Last month foreclosure resales – homes foreclosed on in the prior 12 months – accounted for 13.9 percent of the Southland resale market. That was down from 16.2 percent the month before and down from 31.5 percent a year earlier. Last month’s figure was the lowest since it was 13.6 percent in September 2007. In the current cycle, foreclosure resales hit a high of 56.7 percent in February 2009.

Short sales – transactions where the sale price fell short of what was owed on the property – made up an estimated 21.5 percent of Southland resales last month. That was down from an estimated 22.3 percent the month before and 24.6 percent a year earlier.

The share of investor and cash buying remained near all-time highs.

Absentee buyers – mostly investors and some second-home purchasers – bought 30.6 percent of the Southland homes sold last month. That was down from 32.3 percent in February and up from 28.2 percent a year earlier. The record was 32.4 percent in January, while the monthly average since 2000, when the absentee data begin, is 18.0 percent. Last month’s absentee buyers paid a median $274,000, up 29.2 percent from a year earlier.

Buyers paying with cash accounted for 34.1 percent of last month's home sales, compared with a record 36.9 percent the month before and 32.4 percent a year earlier. Since 1988 the monthly average is 16.0 percent. Cash buyers paid a median $280,750 last month, up 30.6 percent from a year ago.