Southern California Home Prices:
Prices Static But Sales Soar
Southern California Home Prices Were Flat In July… But Sales Went Through The Roof
In the month of July, Southern Californiia Home Prices were flat, showing a flattening of a steep upward trend. However, the number of sales in July in the region was 25,419 units (new and resale homes & condos combined). That’s 23.5% more than a year earlier and the strongest showing since July of 2005.
One of the reasons for this kind of action is the rising inventory. As Southern California home prices have risen, many “underwater” owners have found their situation changing to one where they’re at least able to “break even” if not make a profit on a sale. The rising number of homes available has led to more pricing competition which has slowed that steep rise of prices we’ve been seeing over the last months. Additionally, mortgage rates jumped a bit a couple of months ago. This also may have spurred some buyers to act before they go higher.
Here’s an article from Andrew Khouri in the Los Angeles Times that provides all the facts and figures:
While the price increases took a slight breather over the month, sales soared. Buyers purchased 25,419 new and resale houses and condos in July, 23.5% more than a year earlier and the strongest July since 2005. Sales were up 17.6% from June, when sales fell.”
Southern California Home Prices and Sales Action Good News For The Market
Many economists and market analysts have been speculating as to whether or not Southern California home prices and sales were signalling a return to the “bubble” conditions of the last decade. The good news is the current flattening of prices and increase in sales is a “technical” indicator that the market is healthy and not in danger of becoming another dangerous bubble. The rising home price rate has been very steep and is in need of a flattening or even a slight “pullback”, and a balance point between prices and sales numbers is actually a good sign for all concerned.
Southern California Home Prices.