DQNews Archived Article

Southland Home Prices Up

by Real Estate Analyst John Karevoll
October, 2000

La Jolla, CA.— Southern California home prices reached a new peak last month as potential buyers scrambled to find available homes, a real estate information service reported. A total of 26,151 new and resale houses and condos were sold in Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties last month. That was down 9.0 percent from 28,739 for August, and down 1.7 percent from 26,605 for September last year, according to DataQuick Information Systems.

A decline from August to September is normal for the season. The year-over-year dip was due in part to an exceptionally strong September last year, and to a low number of homes for sale right now. So far this year 227,823 Southland homes have been sold, up 0.4 percent from 226,972 for the first nine months of 1999.

"The stage is set for further price increases through the end of this year and on into spring. What remains to be seen is how far up prices have to go before potential sellers put their homes on the market. Inventory really is low right now," said Mike Ela, DataQuick's president.

The median price paid for a home in the region was $213,000 last month, a new record. That was up 0.9 percent from $211,000 for August, and up 9.8 percent from $194,000 for September last year. Because of a relative increase in sales of entry-level homes, the year-over-year price increase understates the current rate of appreciation, which is closer to twelve percent.

DataQuick, a business unit of Vancouver-based MacDonald Dettwiler and Associates, monitors real estate activity nationwide and provides information to consumers, educational institutions, public agencies, lending institutions, title companies and industry analysts.

For the past five years, home values in expensive Southland neighborhoods have gone up at around twice the rate of homes in entry-level markets. That appreciation gap appears to have started narrowing the past three months, DataQuick reported.