Southern California Home Sales Rebound in January, Prices Continue to Rise
After 25 straight months of declining year-over-year sales, Southern California has finally seen a glimmer of hope in the housing market. According to the Orange County Register, home sales in the region rose by 7 percent in January, totaling 10,581 deals. This marks a significant turnaround from the previous trend of falling sales.
Despite the increase in sales, January’s volume still ranks as the third-lowest in records dating back 36 years. However, the median price of a Southern California home continued to climb, reaching $705,000 in January, up by more than 5 percent from the previous year.
The rise in home prices can be attributed to a severe shortage of homes on the market, as reported by CoreLogic. The lack of inventory has been a driving force behind the continuous increase in prices. January’s median price was down from the previous nine months, but it was still significantly higher compared to the same time last year.
All six Southern California counties experienced year-over-year increases in both prices and sales. Orange County saw the biggest gain, with the median price up by 12 percent to nearly $1.07 million, and sales increasing by 13 percent. Los Angeles County had a more modest price gain of 4.6 percent, with the median reaching $800,000.
The Inland Empire continued to offer the best housing bargains, with median prices of $475,000 in San Bernardino County and $550,000 in Riverside County. However, their annual price growth rates were 5.6 percent and 2.1 percent, respectively.
The lack of homes for sale has been a major factor in driving up prices, with the region averaging fewer than 39,000 listings in November and December. This shortage has led to increased competition among buyers and has further fueled the rise in prices.
High mortgage rates have also played a role in dampening both sales and listings. Interest rates for a 30-year, fixed-rate mortgage averaged 7.4 percent in November and 6.8 percent in December, according to Freddie Mac. The higher rates have not only discouraged potential buyers but have also made homeowners hesitant to sell their properties and give up their low mortgage rates.
Overall, the housing market in Southern California is showing signs of resilience, with both prices and sales on the rise. However, the ongoing shortage of homes for sale and high mortgage rates continue to pose challenges for both buyers and sellers in the region.