Investors, cash buyers and low mortgage rates are turning Southern California into a turnaround market, research firm DataQuick said Thursday.
The counties of Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange posted 22,438 new and resale home sales in August, up 14.2% from 19,654 sales a year earlier.
It’s also the highest August sales figure in six years as more buyers jumped into Southern California’s move-up market to take advantage of low mortgage rates, DataQuick suggested.
The median price paid for a Southern California home hit a four-year high of $309,000 in August as the region experienced fewer foreclosure resales and more transactions involving mid- to high-end homes. That median price is up 1% from July and 10.8% from the median price of $279,000 last year.
“August was the strongest month for home sales so far this year, and the strongest for an August in six years. That’s really saying something given the drop in low-end sales, especially foreclosure resales,” DataQuick said. “Much of the pickup in activity reflects a continuation of trends we’ve seen for months, like the unleashing of pent-up demand in move-up markets and high levels of cash and investor buying.”
The number of California homes selling for under $200,000 fell 11.1% from a year ago in August. Meanwhile, the number of homes sold in the $200,000-to-$400,00 range increased 11.2%.
In addition, sales in the $300,000-to-$800,000 range increased 23.4% year-over-year in August as more move-up buyers pursued properties in this segment. Sales in the $800,000-plus range also increased 19.3% annually.
As far as which lenders are impacting the market, DataQuick found that Wells Fargo served 9.2% of the Southern California market, while Prospect took 2.6% of the market share, followed by IMortgage with 2.5%.