HOUSING - Southland home sales tumble - Despite the 36% drop in deals, the median price rises 2.4% on strength in affluent markets. Low- cost areas fare worst.
Home sales plunged in Southern California last month, making it the worst June in 14 years and reflecting an increasingly soft housing market -- especially in outlying areas such as the Inland Empire and Antelope Valley.
Overall, values are continuing to hold their own -- with the median price of a Southland home rising to $502,000, up 2.4% from a year ago. But prices fell in two-thirds of the region's ZIP Codes, reflecting greater weakness in lower-cost housing markets. Riverside County posted a 6% decline in values.
Experts say prices are likely to remain weak in most areas until buyers start clamoring for homes again.
Home sales: A July 18 article in Business on Southland home sales said tens of thousands of homes were built in the city of San Bernardino in recent years; the article should have said San Bernardino County.
"Without any recovery in the sales volume, we won't recover as far as pricing is concerned," said G.U. Krueger, an economist and real estate consultant who thinks the housing market will start to regain strength by 2009.
Figures released Tuesday show that the number of Southland home sales plunged 36% in June from the same month last year, marking 21 straight months of year-over-year sales declines. San Bernardino County posted the worst numbers, with sales diving 50%.
Real estate experts attributed the drop to several factors, including tighter lending standards and a drop in speculative buying by house "flippers."
But they also note that sales were hitting records earlier this decade, and that is now helping to amplify the decline.
"There's a huge drop in sales volume, but that drop-off has more to do with how high the numbers were a few years ago," said John Karevoll of DataQuick Information Systems, a La Jolla-based research firm that compiles monthly real estate statistics. "Just how much of the demand cycle was pre-met with the activity two years ago, we're not sure."
Regina Nadeau didn't need the latest sales figures to tell her that the market is slow -- she's been trying to sell her Lake Forest condo for the last eight months.
"I pray every day and have a sense of peace, otherwise I would be stressing out," she said.
Nadeau has cut her asking price twice since January, and is now seeking $318,000 for her one-bedroom place. But she says she's reluctant to take it down any lower: "I don't want to sell too cheaply."
Karevoll believes that the psychology of any housing market comes down to "gotta" vs. "wanna."
People who cannot make their mortgage payments or find that their homes are worth less than their loans fall into the "gotta" camp, and are helping to account for a rising tide of defaults and foreclosures.
