Southern California Housing Prices Fall 36%

According to MDA DataQuick, a San Diego based aggregator of county record surveys; house and condominium prices fell by a whopping 36% from April 2008 to April 2009. The median price dropped from $385,000 to $247,000. From the peak in housing prices two years ago prices have fallen by 51% in the region.

Calling price stability “…tenuous at best”, MDA analyst Andrew LePage added “It’s going to come down to how much worse job losses and foreclosures are going to get for the balance of the year.”  Discounted foreclosure properties are dominating the market which is probably exaggerating the amount of the drop in prices. On sales of previously owned homes, foreclosures made up 54% of the total. It’s the seventh month in row that foreclosures have made up over 50% of previously owned properties.

The median price was down 1.2% from March, another month heavy in foreclosure activity. Median prices, in addition to being influenced by overall foreclosure sales, were also influenced by a relative handful of distressed sales in higher priced coastal areas, according to MDA DataQuick.        

The pain of dropping prices was felt in all six Southern California counties with San Bernardino racking up the biggest year on year loss at 48%. Bargain hunting could be the reason that the county also saw the biggest jump in sales with an 88% increase.  San Bernardino County saw real estate prices explode higher during the run up as buyers moved away from the coastal areas toward more affordable housing inland. Foreclosure activity spurred sales gains in five out six Southern California counties, the exception being Ventura County with a drop in sales of 6.1% from a year earlier.
19 percent of Southern California homes that were purchased in April were bought by absentee owners. These purchases could be used as second homes, rentals, or speculative purposes. The normal rate of absentee purchases has averaged 15% per month since 2000, according to MDA DataQuick.

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