Despite a summer cooling trend in Southern California’s housing market, home sales ticked up nearly 8 percent in August thanks to a one-month dip in mortgage rates.
Home prices and sales, which had been dropping for the previous several months, leveled off or increased last month, the Orange County Register reported.
The reprieve could be short-lived as inflation, Federal Reserve rate hikes and a rebound in home-loan borrowing costs push sales and home prices lower in the months ahead.
Bidding wars remain scarce. Buyers are sidelined by a 47 percent jump in the typical house payment. And discouraged owners are shying away from the market as homes take longer and longer to sell.
“The train kind of left the station as far as over-bidding on properties,” Gail Anderson, an agent with Inet Realty in Irvine, told the Register. “For $750,000 properties, we were getting offers close to $900,000. That’s not happening anymore.
“There no longer are multiple offers,” he added. “No more lines at open houses.”
The six-county Southern California region had 17,698 home sales in August, up 7.9 percent from July, according to CoreLogic numbers released by DQNews.
The median price of a Southern California home – or the price at the midpoint of all sales – was $740,000, unchanged from July.
That’s a turnaround from previous month-to-month declines after 30-year mortgage rates dipped to 5 percent in July and early August.
Nonetheless, last month’s sales still were down 28 percent year over year, dropping to the second-worst tally for an August in records dating back 34 years. It was the smallest number of sales for an August since 1992
The region’s median home price, meanwhile, was up a mere 8.8 percent from a year ago, tied for the smallest appreciation rate since the pandemic lockdowns all but halted sales in the spring of 2020. Southern California home values had been rising an average of 15 percent for the previous two years.
Lofty home values coupled with a near doubling of the 30-year fixed mortgage rate boosted the typical payment on a median-priced home by $1,055 a month.
The typical Southern California home took at least 38 days to sell in August, or about a week to 12 days longer than in the summer of 2021, Redfin figures show.
Sale listings, meanwhile, are up dramatically from the start of the year.
As of August, the number of homes for sale in Los Angeles, Orange, Riverside and San Bernardino counties had jumped to 28,286 listings, up 61 percent from December, according to Redfin.
Homes are taking longer to sell, and fewer owners are putting their properties on the market. New listings dropped 30 percent from a year ago to just under 13,000 in August.
— Dana Bartholomew
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