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Shortage of homes on the market pushes prices up 6.8% from December 2015 to a median of $470,000
In December 2016, Southern California home prices reached their highest levels in more than nine years. According to CoreLogic, an improving economy and home shortages raised home prices nearly 6.8% over the past year. Corelogic confirms December’s median home price of $470,000, up 1.1% from previous months.
Running down the numbers
| Area | % Growth | Median Price |
|---|---|---|
| Los Angeles County | 4 | $520,000 |
| Orange County | 5.3 | $665,000 |
| Ventura County | 5.9 | $519,000 |
| Riverside County | 8 | $345,750 |
| San Bernadino County | 8.7 | $299,000 |
| San Diego County | 4.2 | $495,000 |
Prices stayed largely flat in June 2016
With increased demand, the rise in December’s six-county regional median price hit $465,000, which at the time was at a nine-year high.
With mortgage rates and prices rising steadily over household incomes since the November Presidential election, the Southern California region became one of the hottest areas for the housing market.
Economists project prices will continue to rise in 2017, but not as continuously as they have in recent years, making those looking to purchase a home more assertive in their search before prices reach even higher plateaus.
Market appears to not favor buyers or sellers with current inventory of six-to-seven month supply according to Southern California Realtors
While the outcome of rising mortgage rates is uncertain, home prices continue to become more expensive. This uncertainty would produce additional demand if consumers rush to lock in rates before they climb higher. The rush to purchase before rates increase is not occurring in mass.
CoreLogic reported sales dropped 2.9% last month compared with December 2015. CoreLogic analyst Andrew LePage said, “a large part of that decline was because new federal lending regulations took full effect in fall 2015 and pushed many deals that would have closed in November of that year into the following month.”
“The number of deals recorded in December 2015 was artificially high,” he said in a statement. That factor, along with an additional business day last year, “outweighed whatever boost December 2016 sales got from the presidential election.”
In 2016, sales across the region were up 2.1% from 2015 – with the strongest gains seen in counties of Riverside and San Bernardino. Nationwide, the National Association of Realtors said Tuesday, “sales of previously owned homes dropped 2.8% in December compared with November after adjusting for seasonal fluctuations.”