L.A. Times: Home prices rise at lowest rate since '97; Housing still up in some areas

According to this December 13 story by Annette Haddad, the southern California housing market continued to lose steam in November.

The median home price (for all kinds of homes) for the six-county southern California region rose at the slowest rate of growth since February 1997, nearly 10 years. The number of homes sold - 22,117 - was the fewest sold since 1997. The sales rate was down 7.8% from October and down 26.2% from November 2005.

Here are the specifics. Wow, doesn't this look like a market bottom to you? Gee, Los Angeles county looks downright healthy compared to some of these other counties!

County        Median Price   %YOY    Sales %YOY
Los Angeles   $510,000       +2.6%    -18.9%
Orange        $616,000       flat     -29.3%
Riverside     $426,000       +5.2%    -35.7% 
San Bernadino $380,000       +8.6%    -26.7%
San Diego     $482,000       -6.9%    -24.0%
Ventura       $562,000       -8.2%    -30.8%    
6 counties    $487,000       +1.7%    -26.2%   

The experts at USC say yes, there is a correction going on, but they continue to state that nothing in the way of a collapse will occur. I would strongly agree with them if their statement were amended to say "by the end of 2006."

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In a related story, Annette Haddad notes that prices continue to increase in the county's less expensive neighborhoods. And here are the details of that.

The Losers

                                median price     median price      %change
Area                Zip         Sept-Nov 2005    Sept-Nov 2006
Tarzana             91356       $1,175,000       $982,500          -16.4%
Beverly Hills       90210       $2,250,000       $1,897,500        -15.7%
Santa Clarita       91390       $757,500         $650,000          -14.2%
Manhattan Beach     90266       $1,570,000       $1,379,000        -12.2%
Rancho Palos Verdes 90275       $1,235,000       $1,091,000        -11.7%
Monterey Park       91755       $602,500         $532,500          -11.6%
Torrance            90505       $850,000         $758,750          -10.7%
Alhambra            91803       $561,500         $505,000          -10.1%
Palos Verdes Pen    90274       $1,590,000       $1,455,000         -8.5%
L.A. Rancho Park    90064       $977,250         $899,000           -8.0%

The Gainers

                                median price     median price      %change
Area                Zip         Sept-Nov 2005    Sept-Nov 2006
South L.A.          90061       $338,000         $435,000          +28.7%
South L.A.          90037       $375,000         $469,000          +25.1%
East L.A.           90063       $350,000         $422,273          +20.6%
South L.A.          90011       $356,000         $427,250          +20.0%
Inglewood           90305       $475,000         $570,000          +20.0%
Whittier            90602       $485,000         $577,500          +19.1%
Bell                90201       $415,000         $492,500          +18.7%
L.A. Lincoln Hts    90031       $415,000         $491,000          +18.3%
Pasadena            91103       $535,000         $630,000          +17.8%
L.A. Watts          90002       $335,000         $392,500          +17.2%

It sure looks like this bubble has shifted into the lower end areas, doesn't it? It doesn't surprise me, as these are probably areas with minority and/or lower income populations. Under the paternalistic guise of "making the American dream possible for everyone", these demographic groups have gotten sucked into the mania at the late stage, which is the way a mania typically plays out. The net gets cast wider and wider and they are the ones scooped up at the end.