by Calculated Risk on 11/14/2006 01:18:00 PM

DataQuick reports: Southland home sales slow to ten-year low

Last month was the slowest October for Southern California home sales in a decade. Prices continued to level off, a real estate information service reported.
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"It's harder to buy a home if you think it might go down in value than it is if you're convinced it's going up. Buyers are taking their time, trying to wait out the uncertainty in a market that is rebalancing itself. Additionally, many potential buyers are in the move-up category, and they have their own home they need to sell," said Marshall Prentice, DataQuick president.

The median price paid for a Southland home was $484,000 last month, the same as in September. The median was up 2.3 percent from $473,000 for October a year ago. Year-over-year increases have been in the single digits for seven months and are expected to be slightly negative by the end of the year or early next year.

Southern California Median Home Prices
Area	Oct '04	Oct '05	Oct '06	Pct Change
Los Angeles	$409K	$492K	$514K	4.5%
Orange County	$532K	$606K	$625K	3.1%
San Diego	$489K	$513K	$485K	-5.5%
Riverside	$339K	$391K	$410K	4.9%
San Bernardino	$266K	$354K	$362K	2.3%
Ventura	$518K	$596K	$582K	-2.3%
Southern California	$410K	$473K	$484K	2.3%

I added the October 2004 median prices to give a two year perspective on prices.

A total of 22,117 new and resale homes sold in Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties last month. That was down 2.4 percent from 22,654 in September, and down 22.4 percent from 28,489 for October a year ago, according to DataQuick Information Systems.

Last month's sales count was the lowest for any October since 1996 when 18,505 homes were sold. October sales have ranged from 14,608 in 1991 to 32,522 in 2003. The October average is 23,077, slightly above last month's sales. DataQuick's sales statistics go back to 1988.

Southern California Homes Sold
Area	Oct '04	Oct '05	Oct '06	Pct Change
Los Angeles	9,709	9,792	7,662	-21.8%
Orange County	3,508	3,614	2,715	-24.9%
San Diego	4,758	4,155	3,282	-21.0%
Riverside	5,070	5,542	4,200	-24.2%
San Bernardino	3,941	4,217	3,318	-21.3%
Ventura	1,203	1,169	940	-19.6%
Southern California	28,189	28,489	22,117	-22.4%

DataQuick expects to be reporting YoY price declines soon:

"Year-over-year increases have been in the single digits for seven months and are expected to be slightly negative by the end of the year or early next year."

Buyer psychology will probably change for the worse when price declines are routinely reported. As DataQuick's Marshall Prentice noted:

"It's harder to buy a home if you think it might go down in value than it is if you're convinced it's going up."