Home prices hit record levels last month in six counties across Southern California, with the median price rising 22 percent in Orange County to hit $1 million.
The median price in the Southland overall was $735,000 in March, with records now having been set in 12 of the past 14 months, the Orange County Register reported. The median is up by $105,000, or nearly 17 percent, since March 2021 – an average price hike of $2,019 per week.
Prices were up by double digits in Ventura, Los Angeles, Orange, Riverside, San Bernardino, and San Diego counties, according to analysis by DQNews, with data from CoreLogic.
Despite rising mortgage rates, the median home price in Orange County rose 22 percent to $1.02 million for all homes, with single-family houses jumping 28 percent to $1.2 million. At the same time, sales were down 18.6 percent, to 3,184 transactions.
Six of every 10 homes in OC now list for $1 million or more, according to Steve Thomas of ReportsOnHousing.com.
From March 2021 to last month, the median home price in Los Angeles County rose 12 percent to $840,000; Riverside County’s median rose 21.6 percent to $580,000; San Bernardino County’s median rose 15.1 percent to $495,000; San Diego County’s median rose 18.7 percent to $805,000; and Ventura County’s median rose 17.5 percent to $775,000.
While Southern California home sales fell 8.5 percent from a year ago, the region still had its second-highest month for deal volume in 16 years, with 23,225 houses, condos and townhomes changing hands in March.
Rising rates have driven up costs of home ownership for the vast majority of buyers who take mortgages. So has hard-nosed competition for the limited inventory of homes for sale–the lowest level in 18 years. March listings fell 26.5 percent from March 2021, and down 43 percent from two summers ago.
The spike in prices is likely to be short-lived, according to some professionals.
“What (rising rates) did was motivate every single buyer to avoid getting priced out of the market,” Corey Nelson, a broker with Sotheby’s International Realty’s Sunset Strip office in West Hollywood, told the newspaper. “It creates an additional scramble. … But that’s a temporary thing. It’s going to cause the market to taper off.”
The March figures reflect deals signed in late January through February, when rates for the 30-year fixed mortgage averaged 3.7 percent. They don’t reflect last week’s surge to 5 percent, an 11-year high.
Freddie Mac Chief Economist Sam Khater projected the housing market “will remain solid” even as mortgage rates rise. Higher rates will curb refinancing loans, but demand for homes will stay high, with U.S. home prices expected to rise 10.4 percent this year and 5 percent in 2023.
Fannie Mae expects U.S. home sales will drop 7.4 percent this year and 9.7 percent in 2023, with price gains slowing from 20 percent early this year to 3.2 percent by end of 2023.
[Orange County Register] – Dana Bartholomew