May 1st, 2009 12:44 PM by Lehel Szucs
After more than a year and a half of declines, California's median home price finally managed a meager gain, rising 2.2 percent in March to $253,040 compared with $247,590 the previous month.
The state still posted a 39 percent decline from March 2008 when its median price for a single-family, detached home was $414,520. But year-over-year home sales rose 63.8 percent, according to the California Association of Realtors.
The last time California saw a gain in its median price was August 2007, when the median price rose 0.5 percent to $588,970 from $586,030 in July.
At this point, any gain is welcome.
But more declines are likely, according to Marty Rodriguez, owner of Century 21 Marty Rodriguez in Glendora.
"There are still a lot of foreclosures that are expected to come onto the market, and if we get a glut of them the median price will probably go back down a couple of percentage points," she said. "Plus, people are still losing their jobs."
Still, Rodriguez said she's not surprised to see prices edging up.
"Higher-priced homes are starting to move a bit and others are starting to move up to bigger homes, which is causing the median price to go up," she said. "Houses that are priced right are seeing multiple offers. We had a bank-owned property in Diamond Bar that was priced at $359,000, and it got eight offers."
Los Angeles County's median home price fell 4.4 percent in March to $295,100, down from $308,540 in February, CAR reported. Year over year, it was off 31.9 percent, although sales rose by 22.6 percent from February and 65.6 percent from March of last year.
L.A. County last saw a monthly price increase in February, when the county's median price rose 1.2 percent to $308,538.
Thirteen other regions of the state also posted February-to-March increases this year.
They include the Monterey Region (1.2 percent), Monterey County (3.3 percent), Santa Cruz County (5.3 percent), Northern Wine Country (7.1 percent), Orange County (2.5 percent), Palm Springs/Lower Desert (1.1 percent), Sacramento (0.4 percent), San Diego (0.7 percent), San Francisco Bay (1.2 percent), San Luis Obispo (3.6 percent), Santa Barbara South Coast (13.8 percent), Santa Clara (0.8 percent) and Ventura (1.5 percent).
"While we still face continued weakness in the general economy and expect continued foreclosures, the increased incidence of multiple offers indicates that first-time home buyers and investors are responding to dramatically improved housing affordability," Leslie Appleton-Young, CAR's chief economist said in a statement.
"Low mortgage rates and house prices, coupled with the federal first-time home buyer tax credit, is having a definite impact on the California housing market."
CAR's Unsold Inventory Index for existing, single-family detached homes in March was five months, compared with 12.2 months for the same period in 2008. The index indicates the number of months needed to deplete the supply of homes on the market at the current sales rate.
"I think the free-fall is over," said James Joseph, owner of Century 21 Ambassador and Coldwell Banker Ambassador in Whittier. "As soon as prices reach a level of affordability, the bidding is ferocious. It's not uncommon to have 10 to 20 offers."
Distressed properties - foreclosed homes that have been returned to the lender or houses primed for a short sale - are going quickly, Joseph said.
But many owners of non-distressed properties have been slow to adjust their prices to reflect the current - and decidedly less robust - housing market, he said.
Locally, Altadena showed the biggest year-over-year price decline. In March, the city posted a 42.9 percent drop, which brought its median price down to $307,000 compared with $537,500 a year earlier.
Four other cities - Claremont, Duarte, El Monte and Montebello - all saw their annual median price fall by 30 percent or more, according to CAR.