Southern California Home Sales Slump

LA JOLLA, Calif. (DQNews) -- Southern California's housing market remained sluggish in February despite relatively strong demand from investors and others paying cash for homes. Prices appeared fairly flat as many potential home buyers stayed on the sidelines and waited - whether for a sign values have bottomed, job security has improved or credit has loosened, a real estate information service reported.

Last month 14,369 new and resale houses and condos sold in Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties. That was down 0.6% from 14,458 in January, and down 6.4% from 15,359 in February 2010,according to DataQuick Information Systems. The San Diego firm tracks real estate trends nationally via public property records.

A small change in sales -- up or down -- between January and February is normal for the season. On average, sales have risen 0.6% between those two months since 1988, when DataQuick's statistics begin.

The total number of homes sold last month was the lowest for a February since 2008, when 10,777 sold, and the second-lowest since 1995, when 12,459 sold. Last month's sales fell 19.5% short of the Southland's average February sales tally - 17,848 - since 1988.

The 847 newly built homes sold in the region last month marked the second-lowest level on record for a February, behind 842 sales in February 2009. Builders continue to struggle to compete with prices on resale homes, especially distressed properties.

Last month's distressed sales - the combination of sales of foreclosed homes and "short sales" - accounted for well over half of the resale market.

Foreclosure resales - properties foreclosed on in the prior 12 months - made up 37.1% of resales last month, up from 36.8% in January but down from 42.4% a year ago. Over the past year foreclosure resales hit a low of 32.8% last June but since then they've trended higher. Foreclosure resales peaked at 56.7% in February 2009.

Short sales - transactions where the sale price fell short of what was owed on the property - made up an estimated 19.8% of Southland resales last month. That was up from an estimated 19.7% in January, 18.4% a year earlier, and 12.0% two years ago.