Southland home prices jumped 10% in February compared with the same month last year as foreclosure sales dropped significantly. San Diego and Orange counties made particularly strong gains.
The increase in prices indicates that foreclosure sales are not dominating the market as much as they were a year ago. And it could signal that more traditional buyers -- those with equity in their homes looking to trade up -- are getting back into the game.
But the number of homes sold throughout the region was nearly flat, up only 0.8%. That was the lowest year-over-year increase since home sales began to rise in July 2008, according to San Diego firm MDA DataQuick.
A more normal market isn't likely to emerge until the financing necessary to fuel larger purchases becomes more readily available, experts say.
"You still have people out there who historically would be considered very creditworthy but they can't get a jumbo loan," said Andrew LePage, an analyst with DataQuick.
"The jumbo loan market remains dysfunctional because the people who could revive the jumbo loan market -- the investors who would have to buy the loans -- still see a lot of risk in housing."
Even so, Mark and Carrie Rackow believe the time is finally right to put their renovated Agoura Hills home, replete with solar panels and yoga studio, on the market for $1,185,000.
"People are out there a little more, looking," Carrie Rackow said. "I think people are maybe a little bit more hopeful."
According to DataQuick, the median price paid for Southland homes in February was $275,000, marking the third consecutive month of year-over-year increases.
The median -- the price at which half the sales are higher and half lower -- increased 1.3% from January.
The 10% year-over-year rise in the region's median sale price came as little surprise to economists because the comparison is with a time when repossessed homes dominated the market. In February 2009, foreclosures made up 56.7% of the resale market. This year it was 42.3%.
The foreclosure factor will likely remain strong in the housing market and experts have long feared that a new wave of them is coming. Working against that, at least for now, are the Obama administration's efforts to help troubled homeowners and a general reluctance by lenders to flood the market with cheap properties again.
