Wednesday, February 13, 2008

DQNews: Southland home sales slowest for any month in 20 years

Well there you have it. January home sales in the Southland were bad. Really really bad. The lowest in 20 years, dipping below 10,000. DataQuick doesn't have statistics before 1988. Is it any wonder that the logic-free zone (Washington D.C.) is frantically trying to prop up this sinking morass?

The median home sale price in the Southland for January was $415,000, the lowest since $414,000 exactly 3 Januarys ago in 2005. That was -2.4% from December 2007, -14.4% YOY, and -17.8% below the peak reached in the spring and summer of 2007.

The 9,983 homes sold in the six-county Southern California area was -24.6% from December 2007, and -44.9% from January 2007. DataQuick is virtually throwing up its hands, unwilling to make any forecast (not that I blame them), unable to separate out the effect of lender and credit problems from other fundamentals.

The decline in the sales of homes financed with jumbo mortgages is particularly acute. Jumbo loan financings accounted for 18.9% of mortgage financings in January, down from 38.2% YOY. The median price of a home financed within the conforming loan limit (right now, $417,000), was $380,000, -5.0% YOY, and -7.3% from the peak in late winter-early spring 2007.

Mortgage payment commitments are interesting. The median monthly mortgage payment committed to in January is $1,889, down from $1,985 in December, and down from $2,263 one year prior. It is -25% from the peak in June 2006. Adjusted for inflation, the monthly mortgage payment is actually -14.5% from spring 1989.

DataQuick reports that foreclosures continue to be pegged at record levels, ARM and multiple-mortgage financing has dropped sharply, and non-owner occupied housing activity is flat. The firm continues to call other indicators of market distress "mixed."

Here are the Southland numbers:

County         # sold  # sold   % chg    med       med      % chg
                 2007    2008            Jan 07    Jan 08
Los Angeles     6,805   3,398   -50.1%  $520,000  $458,000  -11.9%
Orange          2,400   1,286   -46.4%  $600,000  $520,000  -13.3%
Riverside       3,089   1,939   -37.2%  $415,000  $331,500  -20.1%
San Bernardino  2,373   1,111   -53.2%  $370,000  $298,500  -19.3%
San Diego       2,772   1,826   -34.1%  $472,000  $429,000   -9.1%
Ventura           689     423   -38.6%  $565,000  $477,750  -15.4%
SoCal          18,128   9,983   -44.9%  $485,000  $415,000  -14.4%

Peter Y. Hong at the L.A. Times reports similar information in a February 13 story "Southern California home sales drop to 20-year low".

In terms of interesting statistics, Hong reports that the peak in monthly home sales occurred in June 2005, when 40,156 homes sold.

The stimulus package signed today temporarily raises the conforming limit to $729,750.

Realtors are reporting that some buyers are coming out of hibernation, with some open houses enjoying good attendance. Not many buyers are biting yet, though.

For what it's worth, I'm noticing a pickup in 90278 sales for February. If the trend continues, we could come pretty close to February 2007 sale volume. Currently 90277 volume remains very down, however. 90266 volume currently looks very down, 90254 and 90245 look like their sales volumes are picking up and could meet or exceed February 2007.


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