Tuesday, December 16, 2014

DataQuick: "Southern California November Home Sales Fall Sharply"

by Bill McBride on 12/16/2014 12:45:00 PM

From DataQuick: Southern California November Home Sales Fall Sharply; Median Sale Price Holds Steady Again

Home sales dropped to the lowest level for the month of November in seven years, the result of a relatively low number of days for recording deals, as well as fewer investor purchases and other market factors. ... A total of 15,643 new and resale houses and condos sold in Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties in November 2014. That was down 18.8 percent from 19,271 sales in October, and down 9.5 percent from 17,283 sales in November 2013, according to CoreLogic DataQuick data.

On average, Southern California sales have fallen 8.4 percent between October and November since 1988, when CoreLogic DataQuick data began. It’s likely that this November’s sales decline from October was especially sharp because of a calendar issue: There were only 17 days on which home sales could be recorded at county recorders' offices this November, compared with 22 or 23 days in October, depending on the county. Over the last decade, there has been an average of about 19 days for such recordings in the month of November. ...

"Southern California home sales are closing on a low note in 2014,” said Andrew LePage, data analyst for CoreLogic DataQuick. “Inventory still lags demand in many markets and traditional buyers haven’t filled the void left by the investors who’ve pulled out. Among would-be buyers, affordability and mortgage availability remain as hurdles, as do concerns about job security and the direction of the housing market. But there are reasons to expect more housing demand ahead. According to recent data from the federal government, job and income growth has improved. Many people who became renters after a foreclosure or short sale over the past seven years will want to buy again. And potential home buyers sitting on the fence might be tempted to jump off if they see evidence that mortgage rates will spike from today’s exceptionally low levels.”
...
Foreclosure resales represented 5.3 percent of the Southern California resale market in November. That was up from a revised 4.9 percent in October and down from 6.3 percent a year earlier. In recent months the foreclosure resale rate has been the lowest since early 2007. In the current cycle, foreclosure resales hit a high of 56.7 percent in February 2009. Foreclosure resales are purchased homes that had been previously foreclosed upon in the prior 12 months.

Short sales made up an estimated 6.2 percent of resales in November, up from a revised 6.0 percent in October and down from 10.5 percent in November 2013. Short sales are transactions in which the sale price fell short of what was owed on the property.
emphasis added
The NAR is scheduled to release existing home sales for November on Monday, December 22nd.  Housing economist Tom Lawler is forecasting the NAR will report November sales of 4.93 million SAAR.