SoCal July home sales slow to a crawl

Yesterday, DataQuick reported that Southern California home sales remained at their lowest level since 1995. Sales in the Inland Empire Counties of Riverside and San Bernardino - the last to join the SoCal real estate party - have slowed dramatically.

Interestingly, while sales volume is the same as it was 12 years ago, median prices are still about three times as high in most areas - what costs $500,000 or more today would have cost less than $200,000 in 1995 near the bottom of the last cycle.

To most Southern California residents, after five years of the housing bubble, it probably feels like an "average" home costing half a million dollars is "normal" - it's probably not.

For the first time in a very long while, prices in five of the six SoCal counties were flat or down from year ago levels as shown below.

The change in sales mix, favoring those high-end properties in expensive zip codes that continue to change hands, is apparently keeping the median price for Los Angeles County from going negative.

Appearing just a little bit more enlightened with each passing month, DataQuick President Marshall "almost all if not all of those gains are here to stay" Prentice commented:

These are interesting times because the slowdown in home sales isn't part of a broader economic slowdown, it's a post-frenzy re-balancing act. The last time we had sales this slow, Southern California had been in recession for a few years. Jobs were being lost in droves, people were leaving the area and home prices fell significantly. This time around we haven't seen that, sellers are holding out and we can only assume demand is building up.

Well, you know what happens when you assume.

It's been a long summer for home sellers and that situation doesn't seem likely to change anytime soon - unless of course they lower their asking prices.