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Home prices could be heading upward - and more of the action is starting to come from the $500,000-plus range, which has been practically dead for the past year or so. May's median price in L.A. County was $300,000, according to Dataquick, unchanged from the previous month though still almost 29 percent down from a year earlier. For all of Socal, the median actually rose from April, the first month-to-month increase since July 2007. Now, let not get too excited: Most of the sales activity remains at the lower end - 83 percent of all Socal sales were purchased for less than $500,000 (many of those through foreclosures). But that was down slightly from April's numbers, while sales in the $500,000+ range rose to 17 percent in May from 15.2 percent the previous month. The last time the $500,000-plus market made up more than 17 percent of all sales was in October, 2008. As we noted yesterday, however, the $1 million-plus category is still frozen solid. From press release:
"We appear to be in the early stages of the market gradually tilting back toward a more normal balance of sales across the home price spectrum. As more sellers get realistic, more buyers get off the fence and more lenders offer reasonable terms for high-end purchase financing, we'll see a more normal share of sales in the more established, higher-cost areas that have been nearly comatose," said John Walsh, MDA DataQuick president. "Let's not forget we're into the traditional home buying season right now," he continued, "meaning more people are purchasing for all of the normal reasons, such as a new job or to get settled before school starts. Many are concerned with finding the right home in the right area, not just the most deeply discounted home."
One reason activity at the higher end has been so slow is the limited availability of "jumbo" mortgages. Before August 2007, they made up nearly 40 percent of Socal sales. Last month, they made up 12 percent.
MAY HOME SALES (% change from May 2008)
Los Angeles - 6,521 +19.8%
Orange - 2,667 +17.7%
Riverside - 4,414 +28.2%
San Bernardino - 3,134 +51.0%
San Diego - 3,242 +8.8%
Ventura - 797 +12.6%
MAY HOME PRICES (% change from May 2008)
Los Angeles - $300,000 -28.9%
Orange - $410,000 -15.5%
Riverside - $180,000 -37.9%
San Bernardino - $137,000 -45.3%
San Diego - $295,000 -22.4%
Ventura - $355,000 -18.4%
Source: MDA DataQuick, DQNews.com
Mark Lacter created the LA Biz Observed blog in 2006. He posted
until the day before his death on Nov. 13, 2013.