Tuesday, January 16, 2007

L.A. Times: Home prices climb in county

It doesn't look like we are following the early '90's bubble bust timeline - this bubble is marching to its own drumbeat. A good bubble like this one is darned difficult to burst. According to this January 16, 2007 story by Annette Haddad, the median L.A. county home price rose 6.5% in December.

And buyers are complaining. There were too many buyers out there at the end of 2006, anxious to wrap up deals before the end of the year. Sellers are still refusing offers below asking prices.

And this is in spite of a drop in L.A. county sales of 12.9%, YOY. In spite of average DOM rising 5% to 104 days. Apparently the number of homes on the market declined 14% to 32,363. But the way I read that, I think it just means that many homesellers just gave up trying to sell in 2006 and just let their listings expire. The big question is, will they be back this year, trying to sell again?

The median price was $522,000 for December, the highest since $520,000 set in July. L.A. county's median was up 8.5% in 2006. But sales for 2006 fell 16.8%, which almost looks good when you start looking at some other parts of the state! Home price appreciation in our county actually peaked in 2003, at a rate of 24%.

Catalist Homes notes that there is a rise in pending home sales that depends on the selling of an existing home. How many of those deals will fall through because first-time buyers are unwilling to pole-vault the affordability hurdles?

Here are the specifics for Los Angeles County:

Sale prices          Year-over-year
(In thousands)  Dec. '05   Nov. '06   Dec. '06    Chng.
Resale houses   $520       $540       $550        +5.8%
Resale condos   $400       $410       $412        +3.0
New homes       $445       $483       $511        +14.8
All combined    $490       $510       $522        +6.5
Number of sales   
Resale houses   6,276      5,167      5,405       –13.9
Resale condos   1,542      1,277      1,254       –18.7
New homes       1,027        907      1,044        +1.7
All combined    8,845      7,351      7,703       –12.9

I'm sure there are some homesellers in my neighborhood who would love to see some of these frustrated buyers show here!


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