Home sales take a sharp tumble in August 2007

As if they weren't already slumping enough. According to this September 26 story by Annette Haddad, sales plunged nearly 28% in California and the supply of existing SFRs for sale in the state is up to 11.8 months - double from a year ago.

The California Association of Realtors provides further details, which the organization gets from DataQuick. For the Los Angeles area, they report an August median price (all homes - new and existing, SFR and condo) of $605,300, which is +2.2% from July and +2.6% YOY. Sales were +1.3% from July and -23.9% YOY.

For El Segundo, Redondo Beach, Manhattan Beach:

City               August 2007      August 2006    %YOY Change 
El Segundo          $850,000          $775,000        +9.7%        
Manhattan Beach   $1,700,000        $1,850,000        -8.1%   
Redondo Beach       $820,000          $752,000        +9.0%

L.A. County selected areas:

Area               August 2007      August 2006    %YOY Change
beach cities      $1,150,000       $1,000,000        +15.0%
south bay           $720,000         $625,000        +15.2%
westside          $1,047,500         $735,000        +42.5%

For Redondo Beach August sales, I had experimentally calculated a PRELIMINARY median of $850,000, then as more data came in I later recalculated it as $808,500. Given how slippery and unreliable Zillow data can be, I'm not surprised at the difference. At the time, I wondered out loud if the freeze that hit the market early in August locked out low end buyers, thus a disproportionate share of sales from the higher end drove up the medians. I was thinking, though, that late in the month some "unfreezing" occurred that would have freed up financing again for the low-end homes and allowed more lower-end homes to close their escrows. So the key question is - will alternative forms of financing be made available so people can buy at the lower end again? Yes, here in Redondo Beach, lower end homes typically require jumbo loans.