The residential market in Southern California continues to improve, with both sales volume and median price increasing in February compared to year-ago levels, according to MDA DataQuick. There were 15,359 new and resale homes sold in Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties, DataQuick said. That’s virtually unchanged from 15,361 in January, but up 0.8% from 15,231 in February 2009. Despite the annual increase, February’s number is 14.6% below the historical average of 17,983, according to DataQuick’s records since 1988. February’s sales volume increase continues a 20-month-long run in the Southern California market. Foreclosure resales accounted for 42.3% of the market in February, up from 42.1% in January, and down from 56.7% in February 2009, which was the all-time high. “It’s possible the stars won’t line up this way again for many years. With prices and mortgage interest rates this low, the cost of ownership is about as low as we’ve seen it in decades,” said MDA DataQuick president John Walsh. The median price paid for a Southern California home was $275,000 in February, up 1.3% from $271,500 in January, and up 10% from $250,000 in February 2009. The median peaked at $505,000 in mid 2007 and according to DataQuick, it appears the median bottomed out at $247,000 in April 2009. February marks the third consecutive month of year-over-year price increases. On average, ARMs have accounted for 44.8% of all Southern California purchase mortgages since 2000. But in February, ARMs only accounted for 4% of the purchase mortgage market, down from 4.3% in January, but up from 2.1% in February. “The market is less lopsided, but before a real rebalancing occurs adjustable-rate (ARM) and jumbo mortgages need to come back. Not to where they were in 2007, but back to where they were a few years before that,” Walsh said. Jumbo loans, mortgages above the old conforming limit of $417,000, accounted for 14.8% of February’s purchase lending, up from 14.2% in January and from 10.7% in February 2009, DataQuick said. Before the fall of 2007, jumbo loans accounted for 40% of the market. Government-insured Federal Housing Administration (FHA) mortgages accounted for 38.5% of all home purchase loans in February, continuing the loan product’s rise in popularity since the credit crunch began. Absentee buyers purchased 18.9% of the Southern California homes sold in February. Absentee buyers are usually investors and second-home purchasers, but include anyone who indicated at the time of purchase that the tax bill should go to a different address. In addition, DataQuick said, buyers who appeared to have paid all cash — meaning there was no indication that a corresponding purchase loan was recorded — accounted for 29.3% of February sales. That’s off slightly from the January all-time high of 29.7%. House flippers appear to be returning to the market. In February, the rate of homes bought and re-sold within a three-week to six-month period was 3.4%, up from 1.6% a year ago. Write to Austin Kilgore.
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