SoCal Home Sales Rise as Prices Fall

"You have to view last month's sales in the proper context," he cautioned. "They represent escrow closings, which reflect purchase decisions made in mid-to-late summer. That was before the dramatic worsening of the nation's economic crisis in recent weeks. Over the next few weeks our sales data will begin to show how the meltdown in financial markets this fall has impacted housing demand."

Bargain shopping continued to fuel the Southland market last month, with sales typically rising the most in areas where prices have dived and foreclosures have soared.

Fifty percent of all existing homes that closed escrow in September had been foreclosed on at some point in the prior year. That's up from 45.5% in August and 12.6% in September last year.

At the county level, such foreclosure resales ranged from 36.8% of September resales in Orange County to 68.9% in Riverside County. In Los Angeles County foreclosure resales were 39.1% of all resales; in San Diego 47.3%; San Bernardino 63.1 percent and in Ventura County 44.0%.

The high level of foreclosure resales helped push the Southland's median sale price down to $308,500 in September, the lowest since it was $305,000 in May 2003. Last month's median was 6.5% lower than $330,000 in August and 33.2% lower than $462,000 in September 2007. The September median stood 38.9% below the peak $505,000 median reached in spring and summer of last year.