How slow is LA-Orange County homebuying? Sales 45% below average

House hunters in Los Angeles and Orange counties are still squeamish about buying as April’s sales pace ran at nearly half its historic pace.

Sales of new and existing houses and condos totaled 6,350 in the month in the two counties, according to updated data from CoreLogic. That’s down 11% for the month and off 38% for the year.

So, just how slow was homebuying in the two-county region?

• It’s 45% below the average April pace dating to 1988.
• No. 2 slowest-selling April in records over 35 years.
• No. 17-smallest sales total for any month since 1988.

Homebuyers in spring 2023 were still skittish thanks to economic unease and lofty mortgage rates that have cut buying power by 14% in a year. In the six-county Southern California region, sales fell 43% in a year to 13,940. The median sales price decreased 4.3% to $717,500.

County basics

Let’s look inside Los Angeles and Orange counties, starting with April’s purchases.

L.A. had 4,372 closings, down 12% in a month and 39% lower in a year. O.C. had 1,978 sales – down 8% in a month and 35% lower in a year. Note: A typical April sees an average 0.4% sales increase in one month in L.A. and a 1% increase in O.C.

Have California home prices hit bottom?

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Next, consider how prices moved.

In L.A., the $800,000 median was up 0.1% in a month and 7% lower from the $860,000 record high set in April 2022. O.C.’s $987,750 median was up 0.3% in a month and 6% lower in a year. It’s also 6% off the $1,054,000 peak of May 2022.

Since 1988, the average April has seen price gains of 1.1% in both counties.

Payment pain

Pricier financing is a factor: The 30-year mortgage averaged 6.34% in April vs. 4.98% 12 months earlier.

My trusty spreadsheet tells me that L.A. buyers got an estimated house payment that’s 8% most costly – $3,978 per month on the $800,000 median vs. $3,685 on a year ago’s $860,000 home. And that assumes $160,000 for a 20% downpayment.

O.C. buyers got a 9% bigger payment – $4,912 monthly on the $987,750 median vs. $4,499 for last year’s $1,050,000 median-priced home. The 20% downpayment was $197,550.

Single-family homes

Sales: L.A.’s 3,122 transactions were down 12% in a month and 38% lower in a year. O.C.’s 1,198 closings were down 10% in a month and 38% lower in a year.

Prices: L.A.’s $850,000 median was flat in a month and 9% lower in a year. O.C.’s $1.15 million median was up 2% in a month and 5% lower in a year.

Condos

Sales: L.A. had 1,010 sold — down 12% in a month and 42% lower in a year. O.C. had 577 sold — flat in a month and 35% lower in a year.

Prices: L.A.’s $660,000 median was down 1% in a month and 4% lower in a year. O.C.’s $729,000 median was up 3% in a month and 3% lower in a year.

New homes

Sales: L.A. builders sold 164 units — down 8% in a month and 45% lower in a year. O.C. had 201 new residences sold — down 18% in a month and 1% lower in a year.

Prices: L.A.’s $990,000 new-home median was up 12.4% in a month and 10% higher in a year. O.C.’s $1.13 million median was down 4% in a month and 19% lower in a year.

Builder share: In L.A., new homes were 3.8% of all closings last month compared to 4.1% 12 months earlier. O.C.’s 10.2% share last month compares to 6.7% 12 months earlier.

Jonathan Lansner is the business columnist for the Southern California News Group. He can be reached at jlansner@scng.com

Source: Orange County Register