Southern CA Housing was on Track for Record Spring

The Southern California housing market was on track for record-setting prices and increased sales before the coronavirus outbreak hit, new numbers released Tuesday show.

The median price of a Southern California home — or price at the midpoint of all sales — was $550,000 in March, according to CoreLogic numbers provided by DQ News.

That’s an increase of $35,000, or 6.8%, from the March 2019 median and the highest median in records dating back to 1988.

A total of 18,735 houses, townhomes and condos changed hands at that price last month, up to 3.5% from last year’s tally.

But transactions closed in March reflect deals signed primarily in January and February, before the full impact of COVID-19 cases was known.

And although California’s stay-at-home order didn’t take effect until March 19, county offices and escrow agencies in five of the region’s six counties still were able to complete many transactions online.

March numbers include a projected total for Ventura County, which stopped reporting real estate transactions after March 18, according to DQ News.

The market appears to have made an about-face in the latter part of March, however.

Agents also report decreased activity because most showings now take place online and because loan approvals either are harder to get or are taking longer.

ReportsOnHousing says new sales contracts for existing homes are down 48% in the past four weeks. Escrows fell to 8,646 homes in the 30 days ending on April 16 in the six-county Southern California region.

ReportsOnHousing’s “market time” measure shows how the market has quickly slowed. It now theoretically takes 108 days for a typical home to go from listing to escrow vs. 54 days just four weeks earlier.

Massive job losses mean fewer house hunters as 3.35 million Californians filed for unemployment claims in five weeks ended April 18, according to the U.S. Department of Labor. In the heat of the Great Recession, 3.88 million claims were made in all of 2009.

April’s California consumer confidence, as measured by the Conference Board, took a dramatic fall to a six-year low. The index, based on polling of shoppers’ impressions of economic conditions, fell to 75.2 for April, vs. 107.5 in March and 116.7 a year ago. This was the biggest one-month drop in the index’s 13-year history.

Similar trends prior to the outbreak surfaced in the S&P CoreLogic Case-Shiller Home Price Index for February, also released Tuesday. The index showed resale house prices up 3.7% year over year in Los Angeles and Orange counties and up 3.5% in a 20-city composite.

“Homebuyers, particularly millennials, were encouraged (before the outbreak) by falling mortgage rates and a strong employment market,” said Selma Hepp, deputy chief economist for CoreLogic.

CoreLogic’s report for March shows sales up in every county except for Los Angeles and prices up across the board.

The median price for resale houses and resale condos hit all-time highs regionwide, at $576,000 for houses at $475,000 for condos.

The median home price also set records in Los Angeles and Orange counties and was tied for the all-time high in San Diego County.

Prices have yet to get back to 2006 levels in Riverside and San Bernardino counties.

Posted on nationalmortgagenews.com on 4/28/2020.