Housing Bubble
Southland home sales strong in February
March 20, 2003
La Jolla,CA--Home sales in Southern California remained strong last month as buyers surged toward Riverside and San Bernardino counties to find affordable housing. Prices continue to rise.
A total of 22,516 new and resale houses and condos were sold in Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties last month. That was down 1.1 percent from 22,767 for the month before, and up 0.1 percent from 22,484 for February last year, according to DataQuick Information Systems.
February is usually the slowest month of the year. Still, last month was the strongest February in DataQuick's statistics, which go back to 1988. Sales were up in the Inland Empire, while they were slightly off from record or near-record highs from February a year ago in the Southland's other counties (see chart below).
"What effect will the invasion of Iraq have on home sales? Not very much over the short term. Some buying activity may get deferred, but that will be temporary and the market will catch up again after a few weeks. Long term effects are harder to anticipate. The cost of the war will certainly add to the federal budget deficit which in turn could bring interest rates up," said Marshall Prentice, DataQuick president.
The median price that Southland buyers paid for a home was $292,000 last month, a new record. That was up 3.2 percent from $283,000 for January, and up 18.7 percent from $246,000 for February last year.
DataQuick, a subsidiary of Vancouver-based MacDonald Dettwiler and Associates, monitors real estate activity nationwide and provides information to consumers, educational institutions, public agencies, lending institutions, title companies and industry analysts.
The typical monthly mortgage payment that Southland buyers committed themselves to paying was $1,330 in February. A year ago it was $1,240. The all-time peak was April 1989 at $1,360 when interest rates were higher, DataQuick reported.
Indicators of market distress are still largely absent. Foreclosure rates are low, flipping rates are low, adjustable-rate mortgage usage is low, down payment sizes are stable and there have been no significant shifts in market mix, DataQuick reported.
| All Homes | No Sold Feb-02 |
No Sold Feb-03 | Pct. Chg | Median Feb-02 |
Median Feb-03 | Pct. Chg |
| Los Angeles | 7,898 | 7,576 | -4.1% | $237K | $284K | 19.8% |
| Orange County | 3,497 | 3,385 | -3.2% | $317K | $384K | 21.1% |
| San Diego | 3,763 | 3,725 | -1.0% | $289K | $357K | 23.5% |
| Riverside | 3,264 | 3,822 | 17.1% | $200K | $236K | 18.0% |
| San Bernardino | 2,829 | 2,913 | 3.0% | $159K | $178K | 11.9% |
| Ventura | 1,233 | 1,095 | -11.2% | $303K | $348K | 14.9% |
| So. California | 22,484 | 22,516 | 0.1% | $246K | $292K | 18.7% |
Source: DataQuick
