For the first time in 10 months, the median price of new and resale homes in Southern California did not decline this February. Home sales in the state during February were up 41.3% from last year, the eighth consecutive month in which home sales were higher than those recorded for the same month during the previous year.
Yet despite these promising statistics, the housing slump is far from over. Of the home sales in February, a whopping 56.4% were foreclosure resales (REOs) which didn’t involve the traditional buyer/seller relationship. And with the unemployment rate at 10.1% and rising, more REO properties are expected to be dumped into the market. When considered in conjunction with the fact that median home price in Southern California between February 2008 and February 2009 decreased 38.7%, California still has a long, arduous road to travel before finding a bottom to this recession.
first tuesday take: Unfortunately, neither the actual or adjusted median value represents any single property, whether sold or listed to be sold. Brokers seeking the actual value of a specific property would do well to remember that there is no such animal as a “median priced home”; you simply cannot find one.
Price movement of single family residence (SFR) properties is best broken down in the price of low-end, mid-range, and high-end valued properties. Presently, nearly all sales are in the low-end range which exaggerates the movement downward of the mathematical abstraction of the median priced home. Watch the median rise as the volume of high-end properties start to move at ever lower prices than the year before. It is then that median pricing of all sales becomes really meaningless.
Re: “Housing slump not even close to ending” from the San Diego Union-Tribune