December home sales in Southern California reached their highest mark in three years, according to real estate information provider DataQuick.
A total of 20,274 new and resale homes and condominiums sold in Los Angeles, Riverside, San Diego, Ventura, San Bernadino and Orange counties last month. This is up 5.1% from the prior month and 5.3% from a year ago.
However, this figure is still 17.2% below the December average of 24,488 sales for these California counties.
“The housing market had more to offer in 2012 than many anticipated,” said John Walsh, president of DataQuick.
“A lot of markets not only found a price bottom as foreclosures waned but they started to see their first meaningful gains in nearly two years. Buyers on the fence were drawn back into the housing game by amazingly low mortgage rates, a brighter jobs outlook and, in some cases, a renewed sense of urgency.”
Sparking the rise in December sales was robust investment activity, a record level of cash buyers and more sales gains in move-up markets.
Sales rose by 31.4% in many mid- to higher-cost markets that are priced between $300,000 and $800,000, which includes many move-up buyers. Also, sales of properties valued over $500,000 accounted for 24.7% of all transactions, while sales for housing units above $800,000 jumped 36.3% compared to a year ago.
Meanwhile, lower-cost areas again posted the weakest sales. The number of homes that sold below $200,000 fell 28.1% on an annual basis. Sales in these markets have been hampered by the slowdown in foreclosure activity, which therefore results in less properties being listed for sale, the San Diego-based provider said.
However, while there are less properties available for buyers on the open market, home prices went up due to the market’s shift away from foreclosure resales and toward more mid- to high-end deals. The median sale price in December rose nearly 20% from last year in the six-county region to $323,000. This is up 0.6% from November and a 19.6% increase from December 2011.
“Last year should also be remembered as the year the move-up market awoke. If these upward trends hold, which requires a sustained economic recovery, we should eventually see more inventory hit the market,” Walsh added. “More would-be sellers will be satisfied with what their homes can fetch, and fewer people will owe more than their homes are worth, freeing them up to move. The rise in inventory would at least tame price appreciation.”