by Calculated Risk on 7/16/2014 12:22:00 PM

From DataQuick: Southland Home Sales Down from Last Year Again; Price Gains Throttle Back

Southern California homes sold at the slowest pace for a June in three years as investor purchases fell again and other would-be buyers continued to struggle with inventory and affordability constraints. ...

A total of 20,654 new and resale houses and condos sold in Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties last month. That was up 5.6 percent from 19,556 sales in May, and down 4.4 percent from 21,608 sales in June last year, according to DataQuick ...

On average, sales have increased 6.4 percent between May and June since 1988, when DataQuick’s statistics begin. Sales have fallen on a year-over-year basis for nine consecutive months. Sales during the month of June have ranged from a low of 18,032 in June 2008 to a high of 40,156 in June 2005. Last month was 23.7 percent below the June average of 27,069 sales. Sales haven’t been above the long-term average for more than eight years.
...
“Many of the market indicators we track continue to ease toward normalcy ... For example, the use of larger, so-called jumbo loans is up significantly this year, as is the use of adjustable-rate mortgages. Distressed property sales are way down and, related to that, investor and cash purchases are trending lower, toward more normal levels.” [said Andrew LePage, a DataQuick analyst].

Foreclosure resales – homes foreclosed on in the prior 12 months – accounted for 5.3 percent of the Southland resale market last month. That was up slightly from a revised 5.0 percent the prior month and down from 9.0 percent a year earlier. In recent months the foreclosure resale rate has been the lowest since early 2007. In the current cycle, foreclosure resales hit a high of 56.7 percent in February 2009.

Short sales – transactions where the sale price fell short of what was owed on the property – made up an estimated 6.0 percent of Southland resales last month. That was down from a revised 6.4 percent the prior month and down from 14.5 percent a year earlier.

Absentee buyers – mostly investors and some second-home purchasers – bought 23.6 percent of the Southland homes sold last month. That was the lowest share since December 2010 ...
emphasis added

Both distressed sales and investor buying is declining - and this has been dragging down overall sales.  Even though total sales are still down year-over-year, the percent of non-distressed sales is up slightly year-over-year.  There were 20,654 total sales this year in June, and 11.3% were distressed.  In June 2013, there were 21,608 total sales, and 23.5% were distressed.