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Home Sales Jump 34%--Biggest Rise Since 1988 : Real estate: Increase is in comparison to same month last year, a signal that the industry may be recovering.

March 18, 1994|DEBORA VRANA | SPECIAL TO THE TIMES

COSTA MESA — In another strong signal that the local home building industry is recovering, sales of new and existing homes in Orange County jumped 34.2% during February compared to the same month last year, TRW Redi Property Data reported Thursday.

The increase was the biggest year-to-year monthly rise since November, 1988, when home sales were up 42.8%, the real estate information service said.

Though monthly sales figures don't necessarily indicate a trend, the February increase came on the heels of very strong results for January, when local home sales increased 26.6% from the previous year. "Since this is a continuation of what we've seen the last couple of months, I would say it bodes well for the industry as a whole," said Nima Nattagh(, market analyst for TRW Redi at its Riverside headquarters.

Last month 2,286 home sales closed in Orange County, compared to 1,704 transactions in February, 1993. For the six counties that make up the Southern California region, home sales increased 15.3%, with Orange County posting the biggest gain.

"This is a validation that the Orange County market has turned the corner," said John Shumway, president of Market Profiles, a real estate consulting firm in Costa Mesa. "This is very strong evidence that we're setting a foundation for recovery."

Shumway said the sales figures hold a message for prospective homeowners.

"If they are interested in buying, housing inventories are at rock bottom, and interest rates are starting to creep up," Shumway said. "So there is the possibility that home prices are going to start to increase by the end of the year."

Home sales were up in every Southern California county during February, with Ventura showing the smallest gain at 8%. TRW said that was probably a result of January's Northridge earthquake, which appeared to have a dampening effect on the number of home sales that closed.

Orange County Home Sales

Sales of new and existing homes in Orange County increased by more than 34% in February over last year's level. The average price dropped 0.4% during the same period. Home prices throughout Southern California were up more than 15.3%, and Orange County posted the biggest gain.

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