Fire sale: SoCal home sales spike 65% as prices slide
Breaking news: Sales of existing homes in Southern California shot up 65% in September from year-ago levels, as prices continued their historic decline and bargain-hunters snapped up foreclosed houses, MDA DataQuick reported this morning. The research firm cautioned, however, that the September statistics do not reflect the impact of the financial crisis, which may weaken sales in coming months.
Median prices in the region fell to $308,500 in September, down 33% from year-ago levels. Prices fell $21,500 from August to September, a decline of about $1,000 every business day. Half of the houses sold in the region in September had recently been foreclosed on, MDA DataQuick reported.
"The pitifully low September 2007 sales numbers weren't tough to beat," said MDA DataQuick president John Walsh. "More impressive was that this September's sales volume bucked the seasonal norm and rose above August. Steep price declines, especially inland, have improved housing affordability quite a bit and may keep sales level swell above the record lows we saw late last year and early this year."
Walsh warned, however, that the market may have worsened in October: "You have to view last month's sales in the proper context," he said in a news release. "The represent escrow closings, which reflect purchase decisions made in mid-to-late summer. That was before the dramatic worsening of the nation's economic crisis in recent weeks. Over the next few weeks our sales data will begin to show how the meltdown in financial markets this fall has impacted housing demand."
The "fire sale" buying is strongest in the region's cheapest area, the Inland Empire, where prices are falling the fastest. In Riverside County, September sales were more than double year-ago levels, while median prices fell 37%, to $237,500; In neighboring San Bernardino County, sales spiked 88% from year-ago levels, whilc prices fell 37%, to $205,000.
Prices paid in Los Angeles County fell $20,000 from August, to $360,000 -- a decline of 31.4% from year-ago levels.
More to come.
Photo Credit: Bloomberg News.