Growth of Median Home Prices Slowing

Southern California homeowners, say goodbye to your good friend: Double-digit price appreciation.
By: Annette Haddad: LA Times
For the first time in 4½ years, the region's median home price rose less than 10% year over year, data released today showed. It was the most dramatic sign yet that the Southland's housing market is coming to the end of its long-running boom.

In April, the median price for the six-county region was $485,000, a 9% gain over April 2005, but virtually flat from March's median of $486,000.

What's more, sales in April declined 21.3% from a year ago and were down 16% from the previous month, according to DataQuick Information Systems, a La Jolla-based research firm.

It was the fifth straight month of declines, but at 24,748 transactions closed, the number was still above the average for the past two-decades.

The housing market "is moving in the direction we thought it would," said John Karevoll, DataQuick's chief analyst. "It's all part of a normal end game of the cycle."

But identifying what the next phase may bring could be tricky. These days, Southern California's housing market is defined by three undisputable facts: Slowing sales, flattening prices and a sharp increase in the number of homes for sale.

What's more, about a third of homes on the market have had their asking prices reduced at least once, listing data provided by ZipRealty showed.

The experts call it a market in transition. It's not the same red-hot sellers' market of the last three years, but it's also not a buffet of bargains for buyers either.

"No one's in a panic mode," said Patrick Lashinsky, senior vice president of ZipRealty, an Emeryville-based brokerage with offices in Southern California.

"It's kind of like a pendulum swinging," he said. "Sometimes it swings back a little too much, but right now it's swinging away from sellers and more toward buyers."

Median prices reached new records in three counties: Los Angeles, up 13.6% year over year to $508,000; Orange, up 9% to $628,000; and San Diego, up 4.3% to $505,000, DataQuick said.

The median in Riverside County rose 9.4% to $409,000. It gained 18.4%, to $360,000, in San Bernardino, and rose 10.4% to $584,000 in Ventura County.