We have had a gorgeous winter topped off with enough rain to get us to half of normal for the year, but Southern California seems to be struggling in its real estate. We noted the slowdown in our last reports, and now DataQuick reports that 2014 started out with continued low inventory, rising prices, rising interest rates and a shortage of bargain-priced foreclosed homes.
The number of January sales in Southern California’s six-county region is down 21 percent from December and down 10 percent from a year earlier. The number of sales of new and previously owned homes has fallen below the year-ago level four months in a row.
“Why? We’re still putting a lot of the blame on the low inventory. But mortgage availability, the rise in interest rates and higher home prices matter too,” DataQuick President John Walsh said in a statement.
“Two of the bigger questions hanging over the housing market right now are: how much pent-up demand is left out there and will inventory skyrocket this year as more owners take advantage of the price run-up?’”
The answers won’t be known until spring, he said.
Foreclosure sales continue to play a lesser part in the Southern California market. They made up seven percent of resales, down from 17 percent a year earlier. Short sales made up an estimated 12 percent of resales last month. That was down from 24.2 percent a year earlier.
We will have the Pasadena report in a week.