Southern California home prices take biggest 2-month dip in 12 years
The median selling price across the six-county region of $705,000 for January was off 4.6% in two months vs. a 2.2% historical average drop for the timeframe.
It was a weaker-than-average early winter for Southern California home prices.
December and January are known for price dips as house hunters shy from closing on a home purchase around the holidays. My trusty spreadsheet tells me Southern California homes have averaged 2.2% declines during these two months since 1988. And historically speaking, that’s the largest price drop buyers see in a typical year.
This time around, the median selling price across the six-county region fell by a combined 4.6% during December and January to $705,000, according to CoreLogic, which tracks closed sales for all residences. It also was the largest two-month decline in the past 12 years and the fifth-biggest dip for any December-January period dating to 1988.
This year’s holiday season was by no means normal. Mortgage rates were starting to come off their 2023 highs. Economic and geopolitical conditions were still cloudy. And there was a year-end drop in the number of existing homes listed for sale.
The price slip may is perhaps one factor behind the region’s first year-over-year sales gain in 25 months. We will note that despite this recent dip, prices remain up 33% from January 2020 – just before coronavirus shook housing markets.
Lofty pricing and high mortgages have kept house hunters at bay – January’s sales, while up 7% vs. 12 months earlier, were the third-slowest January since 1988.
Please note that if history is a good barometer, Southern California prices will pick up soon. Since 1988, February and March team up for an average 4.1% price gain – a typical year’s largest increase.
Also, ponder that the early winter price swings were not universal at the county level …
Riverside: The only gain of the six – up 0.2% vs. a 2.5% average dip since 1988. The median price of $550,000 was 5% off the record high of $577,000 from May 2022. Prices are up 41% since January 2020. And prices in the ongoing January-to-March timeframe have averaged a 4.4% gain since 1988.
San Bernardino: The biggest drop – a 7.9% decline from a record high set in November, vs. 3.3% average dip. Its $475,000 median was off from the record $516,000 and is up 32% last four years. January to March? Average 3.1% gain.
San Diego: 5.6% decline vs. 2% average dip. Median of $802,500 is 6% off record $850,000 from July 2023 and is up 37% last four years. January to March? Average 3.7% gain.
Los Angeles: 4.8% decline vs. 1.8% average dip. Median of $800,000 – 7% off record $860,000 from April 2022 and rose 31% last four years. January to March? Average 4% gain.
Ventura: 3.6% decline from a record high set in November vs. 2% average dip. Median of $799,000 is off from a record $828,500 and is up 36% last four years. January to March? Average 2.4% gain.
Orange: 3.2% decline from a record high set in November vs. 1.9% average dip. Median of $1.065 million was off from record $1.1 million and is up 42% last four years. January to March? Average 3.5% gain.
Jonathan Lansner is the business columnist for the Southern California News Group. He can be reached at jlansner@scng.com