According to numbers released by DataQuick, last month’s home sales numbers in Southern California experienced a modest climb from last year.
Median home sales prices in Southland rose year-over-year in April for the first time in 16 months. The median price paid for a home in Southland was $290,000 this year, up from $280,000 in March 2012 and April 2011. This increase is attributed to gains in the region’s coastal counties, where home sales made up 71.5 percent of the area’s total, an increase from last year’s 68 percent.
Also cited as cause for this year’s higher numbers is the fact that foreclosed and discounted properties made up a smaller portion of sales.
While April’s $290,000 median still sits far below the high point of this real estate cycle-$505,000 in mid-2007-DataQuick president John Walsh said that the climbing numbers could be a good sign.
“The housing market continued its painfully slow crawl back toward normalcy last month,” Walsh said. “You can see it in the fading role of foreclosures, the uptick in median prices here and there, and the higher levels of sales in coastal counties.”
He warned, however, that there are many other factors to consider when looking at Southland’s real estate numbers.
“Of course, there are still a lot of things that make this market abnormal,” he said. “Investor and cash buying are still unusually robust. The jumbo loan market has yet to recover, and the use of plain-vanilla adjustable rate mortgages, or ‘ARMs,’ remains far below normal.”
ARMs made up 7.1 percent of April’s Southland home purchase loans, down from 8.5 percent a year earlier. Since 2000, ARMs made up a monthly average of about 36 percent of purchase loans.
In contrast to recent trends, the number of low-cost homes sold in Southland fell due to the decreased number of foreclosures being sold and the shrinking inventory of homes for sale. The number of homes sold in April for less than $200,000 was 4.7 percent lower than last year’s number while sales between $200,000 and $400,000 rose 5.5 percent.
Distressed sales, a combination of foreclosure resales and short sales, made up about 47 percent of April’s resale market-the lowest percentage since April 2008. Foreclosure resales accounted for 28.6 percent of distressed sales while short sales made up 18.4 percent.
Investor activity held near a record-high level, and the number of cash buyers remained at double the historical average. Cash purchases made up 31.5 percent of April home sales, just under last year’s 31.8 percent. Cash buyers paid a median of $225,000, $15,000 more than a year ago.
Absentee purchases made up 27.8 percent of Southland’s sales last month, an increase from 25.4 percent in April 2011. Absentee buying was greatest in the Inland Empire, where it represented 35.8 percent of all homes sold in April.
Last month’s typical mortgage payment for Southland buyers was $1096, down from last year and 62 percent less than the current real estate cycle’s peak in July 2007.
While foreclosure activity is high by historical standards, it has dropped greatly from its peak in recent years. DataQuick reported that financing with multiple mortgages is very low, and down payment sizes are stable.
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