The number of homes and condominiums sold in Orange County in December rose 2.6% from November and the average price jumped 3% to a record $219,744, according to TRW Real Estate Market Information.
December is normally a slow month for home sales, but last month's moderately strong activity does not herald a return to the buying frenzy that characterized much of 1988, according to real estate brokers, home builders and consultants.
"We've left the frenzy behind, judging by the fact that listings are a little more plentiful now," said Robert S. Licata, a senior vice president and district manager for the Grubb & Ellis Co.'s brokerage business in Irvine.
"There's a trend toward property staying on the market a little longer now," he added.
New home sales were a little slow for some builders, simply because they sold out earlier in the year and hadn't yet built new homes, said Matt Disston of Research Network, a Laguna Hills consulting firm.
"But all the indications I've seen say we are returning to a more normal market," Disston said.
According to TRW, which charts sales of both new and used homes, 4,639 houses and condominiums were sold in December, up 2.6% from November's 4,523.
December's sales, however, dropped 4.8% from the 4,872 sales of a year ago.
But the sales in December, 1987, may have been abnormally inflated after a steep drop in November, when consumers temporarily lost confidence in the economy after the stock market crash, TRW said.
December's average price of $219,744 was an increase of 3% from November--when the average was $213,414--and 22.5% from a year ago, when it was $179,443. The previous record price was $216,162 in September.
"The resale market began to slow down considerably in mid-September," said Marion Buie of Marion Buie Realty Inc. in Newport Beach.
"But December was one of our strongest sales months of the year. The buyers came out of the woodwork. I think it took a while for people, psychologically, to get used to the prices," Buie said.
Orange County was at or near the top in home prices among the nation's urban areas last year.
This year, most experts expect home prices to rise more slowly as fewer people seek to buy homes. But they will continue to stay high.
In fact, prices are so high that one consultant expects home builders this year to construct more condominiums at prices between $170,000 and $250,000, which is less than most new single-family homes, now averaging more than $300,000.
Most new construction occurs in south Orange County, where there is still land available.
"There's likely to be a lot of demand in the condominium market because houses have got so expensive," said S. Kelly McDermott, a vice president at Costa Mesa consultant Market Profiles.