TUESDAY, AUGUST 17, 2010 AT 10:52 A.M.
Home sales throughout Southern California slumped last month, experiencing the biggest drop in more than two years, says a report by market research firm MDA DataQuick.
In the counties of San Diego, Los Angeles, Riverside, Ventura, San Bernardino and Orange, 18,946 homes -- both new and resale -- sold in July. That constitutes a drop of more than 20 percent from the previous month when 23,871 homes sold. Sales are also lower when compared to July 2009 -- 21.4 percent lower to be exact -- when 24,401 homes were sold.
In San Diego, home sales fell 19.4 percent from July of last year. It tied with Los Angeles for the fourth largest drop among the Southern California counties surveyed.
Typically July is one of the busier home-buying months and sales haven't been this slow in the region during the month since 2007. It's also the second-slowest July since MDA Dataquick began tracking numbers in 1995. San Diego County mirrors the previous lows for the region.
The reason for the slip is the oft-cited end to homebuyer tax credits, which economists say boosted sales in the spring months at the expense of sales later in the year.
Andrew LePage, an analyst for DataQuick, said the expiration of the tax credits was the main factor but not the only reason Southern California's housing market continues to limp along. The weak economy, tight credit for larger loans and technical matters, like the fact that July had one less business day, all helped drive home sales lower this month.
Prices throughout the region also fell slightly from the prior month, with the median price paid for a home coming in at $295,000. In June, the median home price was $300,000. Still, the region is up more than 10 percent from July 2009 when the median price was $268,000.
San Diego's median price increased by only 5.6 percent from a year ago.
Other interesting facts from the regional numbers:
Foreclosures abound. Foreclosures accounted for 34.2 percent of the resale market, up from 32.8 percent from June but down from the 43.4 percent of last July.
Big loans are harder to get. FHA loans, which are government insured and popular among first-time home buyers, accounted for 36 percent all loans. Last month it was 38.8 percent and last July the number was 39.2 percent. Jumbo loans, those above the $417,000-limit, accounted for 18.4 percent of all loans. Still that's up from both last month when they accounted for 17.6 percent and last July when jumbo loans were only 15.2 percent of the mix. (Interesting tidbit: Before the housing crisis erupted, jumbo loans accounted for a whopping 40 percent of all loans.)
The half-million-dollar question. For July 2010, 21.9 percent of all sales were for homes priced at $500,000 or above. Last month the number was 21.6 percent and a year ago they accounted for 19.2 percent. The low-point for these $500,000-plus sales was in February 2009 when just 13.6 percent of sales achieved the milestone. By way of history, the monthly average of homes sold for $500,000 or more has been 25.4 percent over the past decade.
