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Housing market starts year with double-digit home price gains

High demand, a tight supply of homes for sale coupled with record-low mortgage rates continued to drive up Southern California home prices and sales last month.

Home prices in the six-county region climbed $69,000, or 13%, in the 12 months ending in January, marking the sixth consecutive month of double-digit price gains.

The year-opening median home price, or price at the mid-point of all sales, was $599,500, according to a DQ News/CoreLogic report released Monday, Feb. 22.

Prices and sales decreased slightly from the month before, which is typical for January, which includes deals signed the month before during the traditional holiday slowdown.

But January’s median still came within $10,500 of the all-time high of $610,000 reached in September.

Home sales likewise showed continued strength, rising on an annual basis for a seventh straight month to 17,352 transactions. That’s the biggest sales tally for a January in 14 years.

CoreLogic’s January housing data are on track with numbers released Friday by the California Association of Realtors, showing single-family house prices up 17% in the region and 21.7% in the state as a whole. CAR reported Southern California had a 14.3% sales gain, compared with a 22.5% jump statewide. House prices were up 20.2% in the San Francisco Bay Area, where sales jumped almost 32%.

“With the COVID-19 vaccine continuing to roll out, another fiscal stimulus relief package likely on the way and historically low interest rates, the housing market will continue to thrive,” CAR Chief Economist Jordan Levine said. “The market outlook is stronger than previously projected.”

Mortgage rates were at their second-lowest rate in at least a half century in January. The 30-year, fixed-rate mortgage averaged 2.73% in the three months ending in January, compared with 3.68% a year earlier. That translates into 13% more buying power for homebuyers.

But surging prices have wiped out the savings. A buyer putting 20% down would pay $1,953 a month for a median-priced home last month, compared with a payment of $1,949 a month a year ago — or $4 more a month.

Meanwhile, the number of homes to bid on decreased steadily since May, dropping to just over 17,000 homes for sale at the start of February, according to Reports On Housing. That’s just a little more than half of the listings on the market a year earlier.

Home prices and sales were up across the board in all six Southern California counties and for all housing types, new and existing.

CoreLogic figures show the median price of an existing single-family house increased 14.3% to $640,000, with sales up 12.3%. The median price for an existing condo was $505,000, up 11%, while condo sales rose 22.1%.

New homes accounted for 7.5% of Southern California sales, down slightly from last year, with a median price of $565,000, a 3.8% gain; new home sales increased 1.3%.

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Here’s a county-by-county breakdown of median prices and sales:

Los Angeles County: $690,000, up 12.6%; sales totaled 5,705 units, up 14.3%.

Orange County: $799,000, up 6.7%; sales totaled 2,587 units, up 22%.

Riverside County: $455,364, up 17.1%; sales totaled 3,059 units, up 10.1%.

San Bernardino County: $402,500, up 11.8% to a record high; sales totaled 2,608 units, up 20.7%.

San Diego County: $640,000, up 9.4%; sales totaled 2,647 units, up 1.8%.

Ventura County: $655,000 up 11.2%; sales totaled 746, up 16%.

— SCNG staff writer Jonathan Lansner contributed to this report.

Source: Orange County Register

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