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Housing market picks up, with sales near two-year high

September 5, 2024

Southern California’s housing market gained momentum in July, with prices holding steady at all-time highs and sales hitting the second-highest level of the past two years.

Lower mortgage rates and an increased number of homes for sale boosted transactions, although homes now are taking longer to sell due to increased competition among homeowners.

“The market’s picked back up,” said Jordan Levine, chief economist for the California Association of Realtors. “(Mortgage) rates started to go down in June and continued to go down into July. … I think that the market just continues to be pretty sensitive to these changes in rates. I would say, almost even hypersensitive.”

The median price of a Southern California home — or the price at the midpoint of all sales — was up nearly 6% to $775,000, matching the record high reached in April and June, real estate data firm CoreLogic reported Wednesday, Sept. 4.

The region has seen year-over-year price gains for 13 straight months.

Home sales, meanwhile, rose almost 14% to 17,462 transactions in July, CoreLogic figures show.

During the past two years, just two other months — June 2023 and this past May — have seen sales rise above 17,000 transactions.

Despite the gains, 2024 is shaping up as the third-slowest year on record, with 105,000 homes changing hands through July, CoreLogic figures show. Just two other years — 2008 and 2023 — had fewer sales seven months in.

July’s sales tally — the fourth-lowest in records dating back to the late 1980s — remains 65% below the average for that month.

Falling mortgage rates are helping to revive the market, however. Average rates have dropped almost a full percentage point over the past four months, boosting the buying power for home shoppers.

A buyer who could afford a $770,000, median-priced home in May (when rates averaged 7.2%), now can afford to buy an $841,000 home with the same monthly payment, thanks to mortgage rates now averaging at 6.4%.

In addition, the number of for-sale listings has increased steadily this year.

The six-county region had almost 53,000 homes for sale as of July, according to online brokerage Redfin. While still well below average, it’s up 25% from July 2023 levels.

“I think the new listings have helped both the transaction numbers go up, and we’re starting to see a some moderation in price growth as well,” said Levine, CAR chief economist.

Today’s buyers “are less shell shocked,” said Culver City real estate agent Heather Coombs Perez.

“Now, I feel like it’s a slightly different pool of buyers, … and they’re not dealing with as many obstacles as they were last year,” she said.

With more homes on the market, properties also are taking longer to sell.

In July, Southern California homes averaged 34 days on the market, compared with 29 days a year earlier, according to Redfin.

The time needed to sell every home on the market at the current buying pace increased to 87 days, up from 55 days in March, according to data from Steve Thomas’ “Reports on Housing.”

“Expectations of multiple offers and short market times is simply not today’s reality,” Thomas wrote this week in his latest dispatch. “Instead, there is a lot more seller competition. It used to take days to secure an offer, but for many, it is now taking weeks or months.”

While sellers clearly had an advantage in last year’s market when listings were near a 12-year low, today’s market is “very nuanced,” said Coombs Perez.

“It’s not cut and dry,” she said. “Sellers are not having as easy of a time, and nor are buyers.”

Among Southern California counties, Riverside and San Bernardino were the only ones to see home prices rise from June, CoreLogic figures show.

Sales, however, increased month-to-month in every county but one: San Bernardino.

Prices and sales, nonetheless, were up from year-ago levels across the board.

Here’s a county-by-county breakdown of sales and median prices, with annual percentage changes:

— Los Angeles County’s median rose 7.9% to $890,000; sales were up 15.7% to 5,654 transactions.

— Orange County’s median rose 10.3% to $1.18 million; sales were up 11.5% to 2,450 transactions.

— Riverside County’s median rose 6.4% to $585,000; sales were up 16.7% to 3,381 transactions.

— San Bernardino County’s median rose 6.4% to $500,000; sales were up 9.3% to 2,503 transactions.

— San Diego County’s median rose 4.1% to $885,000; sales were up 10.4% to 2,839 transactions.

— Ventura County’s median rose 3.2% to $842,000; sales were up 18.9% to 635 transactions.

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Orange County Register

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Housing market picks up, with sales near two-year high

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