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Laguna Woods Market
Updated 2-18-2010
Affordability is on the rise as home prices continue to drop in Laguna Woods, in contrast to regional and national trends. In January the median price in Laguna Woods was $183,000, down 18.7 percent from January of 2009, according to MDA DataQuick, an independent market research firm. Sales volume was up almost 343 percent from last year. Of the homes that sold in Laguna Woods, nearly a third did so after a reduction in the asking price averaging 10 percent, according to online market analyst Trulia.com.
The median home price across Orange County was $425,000 last month, 14.9 percent higher than a year ago. It marked the fifth consecutive month of year-over-year price gains for county homeowners. Sales volume was up 3.4 percent compared to the same period a year ago.
Prices in the Southern California region were also up in January compared to a year ago. The median price climbed 8.6 percent to $271,500 for the combined Orange, Los Angeles, Riverside, San Bernardino, Ventura and San Diego counties market. Sales volume also grew for the 19th straight month, but only barely. Sales were up less than 1 percent over January 2009.
Looking ahead, analysts disagree on the direction of the local market. Chapman University's annual economic forecast predicts Orange County's median home price rising 4.9 percent in 2010. Cal State Fullerton's Anil Puri projects a 5 to 10 rise in local home prices this year. Former UCLA economist Christopher Thornberg forsees a 5.1 percent increase in OC prices this year, but then shifting into reverse for a 0.7 percent loss in 2011.
Looking back, research shows home price gains from the boom years actually survived the slump when prices are adjusted for inflation. Orange County’s adjusted median home price stands at 56 percent higher than it did in 1997. Statewide, the adjusted figure is 12.6 percent.
Statewide Market Analysis
(From the California Association of Realtors)
The percentage of households that could afford to purchase an entry-level home in California remained at 64 percent in the fourth quarter of 2009, compared with 61 percent for the same period a year ago, according to a report by CAR. CAR’s First-time Buyer Housing Affordability Index (FTB-HAI) measures the percentage of households that can afford to purchase an entry-level home in California.
The minimum household income needed to purchase an entry-level home at $257,940 in California in the fourth quarter of 2009 was $44,100, based on an adjustable interest rate of 4.5 percent and assuming a 10 percent down payment. First-time buyers typically purchase a home equal to 85 percent of the prevailing median price. The monthly payment including taxes and insurance was $1,470 for the fourth quarter of 2009.
At $44,100, the minimum qualifying income was 4 percent lower than a year earlier when households needed $45,900 to qualify for a loan on an entry-level home. Home prices remained below peak levels, resulting in an improvement in housing affordability compared with the previous year.
National Market Analysis
(From the National Association of Realtors)
Sales of existing homes, including single-family and condos, increased 13.9 percent to 6.03 million units in the fourth quarter, compared with 5.29 million units in the third quarter, according to a report by NAR. Sales also were 27.2 percent higher than the fourth quarter of 2008. Distressed properties accounted for 32 percent of fourth quarter transactions, a decline from 37 percent a year earlier.
The national median home price for existing, single-family homes was $172,900 in the fourth quarter, a 4.1 percent decrease compared with the fourth quarter of 2008. In the West, which includes California, existing-home sales increased 16.2 percent in the fourth quarter to an annual rate of 1.38 million units, 18.2 percent higher than a year ago, according to the report. The median home price of existing, single-family homes in the West was $227,200, a decline of 8.9 percent compared with the fourth quarter of 2008.
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Laguna Woods and Orange County news
(From the Orange County Association of Realtors)
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