Southern California home sales drop to one of lowest levels on record

Southern California home prices fell for a fifth straight month in October while sales fell to one of the lowest levels on record as the housing market continued retrenching in reaction to this year’s mercurial jump in mortgage rates.

The median price of a Southern California home fell to $705,500, the lowest median — or price at the midpoint of all sales — in nine months, CoreLogic reported Monday, Nov. 21.

The total number of homes sold fell 39% to 14,529 transactions, CoreLogic figures show. That’s the second-lowest total for the month of October in numbers dating back to 1988, and the lowest for any month since the pandemic crashed home sales in April and May of 2020. During the past 35 years, just 28 months had fewer sales.

October’s housing numbers fit a trend that started in June, following one of the steepest rises in mortgage interest rates over the past half-century.

Average rates for the popular 30-year, fixed-rate mortgage rose to more than 7% at the start of November from just over 3% at the end of 2021. On Thursday, Nov. 17, the Freddie Mac rate retreated to 6.61%, still double start-of-the-year rates.

As a result, buyers needing to borrow money lost more than a third of their purchasing power.

While the median home price rose just 4.4% since October 2021, the typical mortgage payment for last month’s median-priced home jumped 62%, or $1,418 a month. A buyer who can afford last year’s median-priced $675,500 home now can only afford a home costing $436,000 — which is less than the median price for an Inland Empire condo. Related Articles

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Source:: Los Angeles Daily News

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