What California Realtors say about Housing Prices
Continue Reading Add comment October 22nd, 2008
California home sales are soaring. What? Aren’t we in the middle of a credit crunch and mortgage industry meltdown?
Bargain shoppers are snapping up distressed property, according to real estate researcher DataQuick. In Northern California sales were up 40% in September, the largest jump in six years. In Southern California sales were up 65%, the largest such increase on record.
While sales are up, those results are from last year’s depressed levels. Prices are still falling. In Northern California prices fell 40% to $400,000 on average. Down South, prices fell 33% to $308,000, an amount not seen in five years. Half of all sales were foreclosures.
If you’re thinking of snapping up that historic Victorian in San Fran or a swanky pad on Malibu’s Billionaire’s Beach for a song, think again. Prices in the most desirable areas haven’t fallen that much. In Frisco the average home will still set you back $675,000, down 12% in the past year. In Los Angeles, prices seem much lower, down 31% to an average of $360,000, but that reflects a lot of working class neighborhoods where prices have fallen most dramatically.
Even the California Association of Realtors, not exactly a group of real estate doomsayers, figures Golden State property values will continue to tumble. The Realtors forecast that prices will decline 6% next year to a statewide median of $350,000. That’s after a 32% drop in 2008.