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Valuations in Sample Home Survey Increase

December 20, 1987

Due largely to continued price increases of selected dwellings in certain areas of Los Angeles County, home prices rose 7.3% from April and 13.7% from October, 1986, according to a survey by the Real Estate Research Council of Southern California.

The study is based on the appraised values of 214 sample homes and is intended to show trends in home prices, not levels, according to Michael Carney, executive director of the council.

Appraised prices of the sample homes in Los Angeles County as a whole rose in October an average of 9.4% from last April and 17.2% from October, 1986, according to Carney, who is also a member of the faculty of the School of Business Administration at Cal Poly Pomona.

He said that the biggest annual increases were in North-Central Pasadena, 22.1%; Long Beach-Harbor, 22.9%; Westside-Santa Monica, 25.3%, and Southwest, 20.5%. Smaller annual increases were recorded in East San Gabriel-Pomona, about 10%, and the San Fernando Valley, about 13%, Carney said.

Other areas where the sample homes experienced continued large annual increases were Ventura County, 14.1%; the city of Santa Barbara, 20%; San Diego city beaches, 14.4%; northern Orange County, 13.4%, and southern and beach areas of Orange County, 14.8%.

The lowest annual rates of increase--once again--were in Riverside County, 5.7%, and San Bernardino County, 8.1%.

The market price index for the seven-county survey area (Los Angeles, Santa Barbara, Ventura, Orange, San Bernardino, Riverside and San Diego) reached 381 in October, indicating that the average home price in the sample has increased 281% from the base year (1975) price, Carney said. He added that this represents an 11.8% compound annual rate of increase over the past 12 years.

"Since 1975, average sampled prices have more than quadrupled in Los Angeles, Ventura and Santa Barbara counties, more than trebled in Orange and San Diego counties, and almost trebled in Riverside and San Bernardino counties," he added.

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