At best, this spring home selling season has been meek.
Now, it’s rarely easy to divine housing trends — especially at confusing parts of the economic cycle like these days. But there are few signs of boom in the latest wave of market reports.
First, ponder home prices in Los Angeles/Orange counties as measured by the S&P/Case-Shiller indexes. By this math, home prices fell on a month-to-month basis again in March — 0.7 percent — after eight consecutive months of increases. This index tracks gains or losses on individual homes that sold in a month vs. tracking changes in a big index, like a median selling price.
As for S&P trends near here, despite the back-to-back monthly dips, the L.A./O.C. index is still 6 percent above March 2009 — the third consecutive gain. Plus, that increase is the largest since September 2006.
Then there’s the Real Estate Research Council of Southern California and its most unusual home-valuation technique: Twice a year, the group gets volunteer appraisers to review the exact same homes from the region over and over again. The exercise — that adds a human eye to the great price debate — goes on every October and April.
The latest version is out, and RERCSC appraisers found Orange County values — from average movement in values from reviews of the same 39 sample homes — up 1.4 percent on a year-over-year basis. Now that’s no home run or profit but this marked the first yearly gain in the RERCSC O.C. index since October 2006.
Keeping with signals of meager price appreciation, CoreLogic finds in Orange County that home prices for March — including distressed sales — increased by 2.85 percent vs. a year earlier. (Excluding distressed transactions, year-over-year change was up 4.04 percent.) CoreLogic’s math is much like the S&P “paired sales” logic.
So if that trio of data crunchers suggests modest — perhaps waning — price progress, let us add to the puzzle: DataQuick’s median selling price for Orange County was up 13.2 percent in the year ended in April.
CAN YOU SELL IT?
Price indexes are fun for cocktail parties. Yet people get paid in real estate — from owners to agents to others businesses tied to transactions — by deals.
Even with tax incentives and cheap mortgages, there’s no stampede of buyers.
April nationwide home-sales data from National Association of Realtors shows the West’s housing recovery proportionally meek as the second federal homebuyer tax credit winds down.
Sales in Western states ran at a 1.21 million annual pace in April. Yes, that’s 5.2 percent above a year ago but that was the smallest advance among the four regional slices tracked by NAR. Plus, it’s well behind the 22.8 percent rate of annualized sales gain that was found nationwide.
Patrick Newport, economist at IHS Global Insight: “The figure that puzzles are sales in the West, where sales soared just before the first tax credit expired, but have hardly responded to the second tax credit.”
And DataQuick’s statewide figures say California homebuying was tepid in April with an estimated 37,481 residences sold — down 1.3 percent from April 2009. (Note: Average California sales for April since 1988 is 44,758.)
CAN YOU AFFORD IT?
Who can debate that homes are dramatically cheaper?
According to S&P/Case-Shiller local prices are still 37.7 percent off their peak. And RERCSC appraisers show that Orange County homes by their math are worth 29 percent less than the peak of October 2006.
But is that enough?
Orange County has the seventh least affordable housing out of 225 major markets around the nation, according to the latest National Association of Home Builders/Wells Fargo Housing Opportunity Index. According to first-quarter data, Orange County had:
•An Housing Opportunity Index that translates to 35.1 percent of the new and existing homes sold being affordable to Orange County shoppers earning the local median income vs. 48.2 percent a year earlier.
One reason affordability’s down? Costs are up. Median home price in Orange County, by this math, rose 13.9 percent vs. a year earlier.
Paychecks haven’t kept pace. Median income this year runs $87,251 locally – that is up 1.3 percent vs. a year earlier.
To be fair, there are communities with worse affordability! New York metro (20.9 percent of homes affordable); San Francisco (23.4 percent); San Luis Obispo (32.4 percent); Santa Cruz and Ocean City, N.J. (34.1 percent); and Honolulu (34.7 percent).
WHO IS PAYING UP?
Where does housing’s price oomph reside around town?
RERCSC appraisers found the most price strength in central Orange County (up 3.4 percent, year-over-year for April) followed by southern and beach communities (up 2.8 percent.) But northern O.C. values were down 1.8 percent, by the RERCSC math.
Curiously, that’s a bit at odds with our own region-by-region analysis of April’s local homebuying numbers from DataQuick. We found Orange County slices up this way …
•Mid-county ZIPs had median selling price up 9.7 percent vs. a year ago. The best in the county and in relative agreement with RERCSC’s geographical analysis.
Next came south inland ZIPs with price gains of 8 percent in a year. Again, in the general direction of the appraisers.
Beach cities’ ZIP codes saw selling prices up 3.5 percent vs. a year ago. Not far off RERCSC data, too.
But DataQuick’s math had north-inland ZIP codes with a median selling price up 6.4 percent vs. a year ago – well off the RERCSC findings.
So which is it North County?