DQNews: Continued nose-dive for Southland home sales

Before I forget to tell you, Los Angeles Business Journal pulled a fast one on me and published its monthly home sale data in the January 7 issue. I was not expecting them to release the data so soon and did not think to check the news rack for it. Since I never got a hard copy of that issue, I won't be able to report their data. Sorry about that.

DQNews reports in this January 15 story that December 2007 Southland home sales were dismal. Sales were up 0.5% from November (whoop dee do), but down 45.3% from December 2006. Is that a nose-dive or what?

Here are the ugly numbers. We are seeing double-digit declines in sales volume and prices across all counties.

Southland          Sold     Sold     %YOY    Median $    Median $   %YOY
County             Dec-06   Dec-07   Chg     Dec-06      Dec-07     Chg
Los Angeles        8,479    4,430   -47.8%   $525,000    $470,000  -10.5%
Orange             2,985    1,731   -42.0%   $630,000    $565,000  -10.3%
Riverside          4,542    2,503   -44.9%   $432,000    $355,500  -17.8%
San Bernardino     3,357    1,518   -54.8%   $370,000    $315,000  -14.9%
San Diego          3,823    2,468   -35.4%   $495,000    $430,000  -13.1%
Ventura            1,023      590   -42.3%   $590,500    $525,000  -11.0%
SOUTHLAND         24,209   13,240   -45.3%   $490,000    $425,000  -13.3%

One DataQuick analyst observes, "It is like any anybody who can, is waiting this thing out. We won't know what really has been going on until things have settled down and we can look back." So now the analysts now claim that they can't forecast with such a "lousy basis" in the numbers. Hmm, it was easy to forecast that the market would keep going up while the numbers were going up. Is it so hard to forecast that numbers might continue to decline?

The median Southland home price has nearly reached the February 2005 price of $420,000. The $505,000 median peak was reached in the spring and summer of 2007. Jumbo loan financing is now about 22% of the Southland market, compared to almost 40% before the credit crunch.

DataQuick reports that down payment sizes are stable. Flipping rates are stable and non-owner-occupied housing activity is edging up. They interpret this as a positive sign but I see that as simply not enough people having gotten burned yet.

The DataQuick analyst may have a point about the difficulty of forecasting. I've said it here a few times that things have looked so bad in November and December that the market is probably due for a bounce, although a dead-cat one. Mortgage applications bounced big-time the first week of the new year. Beach city sales, too, seemed to recover somewhat. We'll have to wait and see how much the markets recover this spring selling season.