Cash buyers, investment uptick boost Southern California median home price 20 percent in December

Southern California's median home price jumped 20 percent in December from a year ago, driven by strong investment activity, a record number of cash buyers and a continued shift to mid- and high-end sales, a market tracker said Tuesday.

Sales also showed strength, increasing 5 percent from December 2011 and hitting their highest level for the month in three years, said La Jolla-based DataQuick.

Last month the median home price across the region increased to $323,000 from $270,000 a year earlier. The median made double digit percentage gains in all six counties.

"The question when the year started was would the market find a (price) bottom. I think there are far fewer people worried now about prices falling and significantly more concerned about prices going up," said DataQuick analyst Andrew LePage.

"We've answered the question: Yeah, we found a bottom."

For all of Southern California, sales of new and previously owned houses and condominiums increased to 20,274 last month from 19,247 in December 2011.

Riverside and San Bernardino counties were the only ones with declining sales, DataQuick said.

For the full year sales increased 10 percent to 235,119 properties from 214,362 in2011.

"The housing market had more to offer in 2012 than many anticipated. A lot of markets ... started to see their first meaningful gains in nearly two years," DataQuick President John Walsh said in a statement.

Buyers were drawn back into the market by record or near record low mortgage rates and a brighter job outlook, he noted.

"Last year should also be remembered as the year the move-up market awoke. If these upward trends hold, which requires a sustained economic recovery, we should eventually see more inventory hit the market," Walsh said.

Rising prices would also bring more sellers into the market.

The company's report showed that:

In Los Angeles County the median price of a previously owned house increased 15 percent to $352,000 from $305,0000 in December of 2011. Sales increased 9 percent to 7,198 properties from 6,591 a year ago.

For the full year sales increased 12 percent to 80,954 properties from 72,305 in 2011.

In San Bernardino County the median price increased 20 percent to $180,000 from $150,000 a year ago. But sales fell 12 percent to 2,135 properties from 2,418 in December 2011.

Full-year sales were flat - 28,548 versus in 2011.

Riverside County's median price rose 19 percent to $231,000 from $194,000 a year ago and sales declined 9 percent to 3,248 properties from 3,584.

Full-year sales were also flat - 40,369 versus 40,312 in 2011.

Ventura County's median price increased 14 percent to $370,000 from $325,000 and sales increased 12 percent to 866 from 771. For the full year sales were up 19 percent to 9,989 from 8,383.

Cash buyers accounted for 34 percent of sales in December, tying the November and February record level, DataQuick said. A year ago cash buyers accounted for 30 percent of sale.

Distressed properties continue to have a diminished role in the market.

In December foreclosure resales accounted for 15 percent of the Southland sales, flat from November and down from 32 percent a year ago.

Last month's level was the lowest since foreclosure resales had a 14 percent percent of the resale market in September 2007. In the current cycle, foreclosure resales hit a high of 57 percent in February 2009.

Short sales - transactions where the sale price fell short of what was owed on the property - made up an estimated 26 percent of resales last month. That was also flat from November and a year ago.

A separate report from the California Association of Realtors showed a similar trend. (The association calculates sales on an annualized rate and does not include transaction numbers.)

During December sales of previously owned houses increased 1 percent to an annualized rate of 522,510 units, the Los Angeles-based group said. That represents the number of sales that would occur last year maintained the December pace throughout the year.

In Los Angeles County sales increased 5 percent from a year earlier (the association does not provide numbers). But the fell 15 percent in San Bernardino County and 9 percent in Riverside County.

The association also had prices increasing by double digit percentage amounts across Southern California from a year earlier.

And the year ended in encouraging fashion.

"The positive fundamentals in the housing sector continued to attract potential homeowners and investors, which resulted in strong housing sales in the fourth quarter," said Leslie Appleton-Young, the association vice president and chief economist.

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Source: http://www.dailynews.com/business/ci_22379666/cash-buyers-investment-uptick-boost-southern-california-median?source=rss

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