Ruth Mills Team
San Diego Realtor
San Diego News & Real Estate Blog
Southland Home Sales Surge as Prices Stabilize
Home sales increased in Southern California in December even as home values continue to stabilize, according to a report issued Wednesday by CoreLogic. According to the report, sales in the six-county Southland region rose 4.3 percent on a year-over-year basis, marking just the second month this year in which sales were higher on a yearly basis. The median price for homes sold in December, meanwhile, was $415,000, unchanged from the two months prior and up just 5.1 percent from December 2013. That figure marks the smallest year-over-year gain in the Southland's median home sales price since April 2012.
Economists lauded CoreLogic's report, calling it evidence that the Southern California housing market is stabilizing. Gone are the rapid price gains we saw as 2013 gave way to 2014, and the overall economy is in better shape than it's been since the Great Recession. Those factors, combined with interest rates that are still very close to record lows, have created a perfect environment for first-time buyers, a vital segment of the overall housing market that has disappointed in recent years. Despite low interest rates and slumping property values seen in recent years, first-time buyers have not made much of an impact on housing because of strict lending standards adopted by banks in the wake of the foreclosure crisis. In recent months, many lenders have eased their criteria in response to continued improvement in the broader economy. Unemployment has fallen substantially this year, and wage growth has picked up in recent months, as well.
While the CoreLogic report points to continued improvement in the Southern California housing market, there is one factor that concerns some economists. With sales picking up and more people able to qualify for home loans, a few economists are worried about supply. If demand continues into the Spring, and people aren't listing homes for sale at a similar pace, prices could rise again substantially and price many would-be buyers right out of the market.