The news that Southland home sales rose in April for the first time in a long time was a hopeful sign for those waiting for the market to turn. But before you plunge a For Sale sign into your lawn or head off to the loan officer to get pre-approved, let’s take a closer look. From the DataQuick press release:
Southern California home sales surged last month to the highest level since August as bargain shoppers took advantage of price slashing. Although some higher-end coastal markets also posted gains, the swell in transactions mainly reflects more sales of homes under $500,000 in inland areas where depreciation and foreclosures have been greatest, a real estate information service reported.
In other words, those of us who live in and around L.A., where just about every home costs well over $500,000, aren’t seeing any difference. I haven’t seen a Sold sign in my neighborhood near the Grove in ages.
Also, DataQuick points out, home sales were still down 19% from April 2007.
Sales from March to April have risen on average 1.2 percent since 1988, when DataQuick’s statistics begin. Although last month’s sales total was the highest for any month since August 2007, when 17,755 homes sold, it was still the weakest April since April 1995, when 15,303 homes sold, and the second-lowest April on record. Last month was 38 percent below the April average of 25,311 sales.
About 38 percent of the homes sold had been foreclosed upon in the previous year, DataQuick said, accounting for more than one-quarter of Orange County sales and more than half of Riverside County sales.
Last month’s upswing in sales was most pronounced for homes priced under $500,000, which accounted for two-thirds of the Southland’s sales gain over March. Riverside County, the epicenter of Southland foreclosure activity and price declines, posted the region’s only year-over-year sales increase – that county’s first in two years. ZIP codes showing relatively large annual gains in sales of existing houses included those in San Jacinto and Lake Elsinore in Riverside County, Victorville in San Bernardino County, Lake Forest and Anaheim in Orange County, Lancaster in Los Angeles County and Chula Vista in San Diego County.
Some of the price declines in these areas have been quite dramatic. If you don’t care about a mind-numbing commute and are willing to be surrounded by other foreclosed properties for the foreseeable future, there are relative bargains to be had. Examples:
Lake Elsinore: 41014 Sunsprite St.
4BR/3B/3,613 square feet, built in 2006
Last sold in June 2006 for $550,000
Current price: $309,000 (bank-owned)
Victorville: 15035 Mesa Linda Ave.
4BR/3B/3,291 square feet, built in 2006
Last sold in February 2007 for $472,000
Current price: $270,000
Lancaster: 4808 Spur Ave.
5BR/5B/3,418 square feet, built in 2006
Last sold for $479,500 in June 2006
Current price: $299,000