by Bill McBride on 6/15/2010 05:55:00 PM
Tuesday, June 15, 2010
From DataQuick: Southland sales at 4-year high
Note: as always I ignore the median price and use the repeat sales indexes from Case-Shiller and CoreLogic.
Southern California home sales rose last month in all but the lowest price categories as buyers took advantage of tax credits and low mortgage rates. ... A total of 22,270 new and resale houses and condos closed escrow in Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties last month. That was up 9.7 percent from 20,299 in April, and up 7.2 percent from 20,775 in May 2009, according to MDA DataQuick of San Diego.And here is the dumb headline of the day: Southern California median home price surges 22.5% (ht JBR). So what? That just says the mix changed ... and that is because the distressed sales are moving on up to higher priced neighborhood.
May sales were the highest for that month since May 2006, but they still fell 15.0 percent short of the average number sold in May since 1988, when DataQuick’s statistics begin. The 9.7 percent increase in sales between April and May compares with an average change of 6 percent since 1988.
“The important thing to remember, though, is that what we saw in May was partly driven by government stimulus,” he continued. “In the second half of the year the market will have to stand on its own again, barring new forms of government involvement. Prices will be tested if there’s any sudden move by lenders to release a flood of distressed properties.”
Foreclosure resales accounted for 33.9 percent of the resale market last month, down from 36.4 percent in April and 49.8 percent a year earlier. The all-time high for foreclosure resales – homes that had been foreclosed on in the prior 12 months – was 56.7 percent in February 2009. Foreclosure resales have waned over the last year as lenders have channeled more distress into loan modifications and short sales.
Foreclosure activity remains high by historical standards but is lower than peak levels reached over the last two years.
What matter is this is probably the high point for sales this year. This report includes both new and existing home sales, and new home sales are counted when the contract is signed (peaked in April) and existing home sales are counted when the transaction closes (will peak in May or June).
Posted by Bill McBride on 6/15/2010 05:55:00 PM