L.A. Business Journal: Median Home Prices fall 35% in January: "Nothing and no one is untouchable"

According to a February 9 story by Francisco Vara-Orta in the Los Angeles Business Journal, the median price of a single family residence (SFR) in Los Angeles County took a "jaw dropping" 35% hit in January YOY. Condo prices fell 26%. That puts the median SFR price at $320,000, down from the $585,000 peak in mid-2007. Condos peaked at $460,000 in August 2007.

Michael Nourmand, a Beverly Hills realtor who serves the tonier westside, states "Nothing and no one is untouchable in this economic climate," then describes how six multi-million dollar escrows were lost in the days after the September financial market meltdown. He says "it's hard to nail down a figure but you are seeing about 15% softness in the Westside housing market."

In other tony areas that in boom times drew in a lot of people but are now choking on foreclosures, price drops have been steep. One area of North Hollywood has seen a median home price plunge from $1.2 million to $654,000 within 12 months.

Although Los Angeles County SFR sales came in at 3,108, down 8% YOY, in a number of markets recent sales volume has been starting to trend up, thanks to lower prices. But even the higher sales volumes are well below sales volumes during the peak years. In 2004 and 2005, Los Angeles County typically sold 8,000 to 11,000 homes each month. Lancaster is enjoying the best sales volume it has experienced in 35 years.

USC's Delores Conway at the Lusk Center for Real Estate reminds us that January is normally a very slow month and does not give an accurate market picture. She notes that unemployment is rising in the financial services industry and that the westside housing markets could see more pressure. She further adds that although there has been some correction already, "now we have the recession and unemployment putting pressure on the market. What's certain is the uncertainty."

-------------------------- SFR --------------------------------
COMMUNITY          ZIP    Jan     %YOY         Jan    %YOY
                         Sales   Change      Price   Change
L.A County              3,108      -35%    $360,000   -35% 
El Segundo       90245      2      -80%    $492,000   -48%
Hermosa Beach    90254      2      -86%  $2,380,000  +110%  
Manhattan Beach  90266     10      -55%  $1,694,000    -2%  
Redondo Beach    90277      6      -54%    $870,000   -12%
Redondo Beach    90278     11        0%    $612,000   -18%

------------------------ CONDO --------------------------------
COMMUNITY          ZIP    Jan     %YOY      Jan       %YOY
                          Sales   Change    Price     Change
L.A. County              1,030      +4%    $310,000   -26%
El Segundo       90245       3      N/A    $410,000    N/A
Hermosa Beach    90254       6    +500%    $975,000    +1%
Manhattan Beach  90266       1     -67%  $1,299,000   +27% 
Redondo Beach    90277       6     -14%    $651,000   -15%
Redondo Beach    90278       7     -61%    $710,000    +3% 

The most expensive SFRs in January were in Beverly Hills 90210 (+36% YOY); Pacific Palisades 90272 (+9%); Brentwood 90049 (+48%); Malibu 90265 (-19%); Santa Monica 90402 (-24%); Manhattan Beach 90266 (-2%); Rancho Park 90064 (+48%); Hancock Park 90004 (+28%); Encino 91436 (+28%); West Hollywood 90069 (-10%).

The most expensive condos in January were in Hermosa Beach 90254 (+1% YOY); Venice 90291 (no 2008 data for comparison); Arcadia 91006 (no 2008 data for comparison); Redondo Beach 90278 (+3%); West Hollywood 90046 (+35%); Torrance 90503 (+27%); West Hollywood 90069 (+16%).

The areas suffering the greatest SFR price losses in January were Koreatown 90006 (-66% YOY); Palmdale 93591 (-64%); North Hollywood 91602 (-62%); Inglewood 90302 (-62%); Compton 90222 (-61%); Watts 90002 (-61%); Los Angeles 90011 (-61%); South Los Angeles 90001 (-59%); Long Beach 90813 (-59%); Willowbrook 90059 (-57%).

The areas suffering the greatest condo price losses in January were Long Beach 90807 (-60%); Carson 90745 (-55%); Paramount 90723 (-55%); Encino 91316 (-53%); Azusa 91702 (-51%); Norwalk 90650 (-50%); Canoga Park 91304 (-48%); Panorama City 91402 (-47%); Van Nuys 91405 (-46%); Koreatown 90005 (-45%).