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Laguna Woods Market
Updated 8-21-2010
Home sales were up dramatically and affordability improved again in Laguna Woods last month. July sales volume grew more than 52 percent from July of 2009. But, unlike the rest of Orange County and the region, home prices dropped more than 16 percent last month compared with the same period last year. The median price of a home in Laguna Woods stood at $175,750 in July, according to MDA DataQuick, an independent market research firm.
“There’s been a pause in the market. Some potential buyers – including those who held off until the tax credits expired – will take their time to assess market conditions, searching for signs of renewed price cuts," said DataQuick President John Walsh. "Depending on the economy and other factors, that might be what some of them find.”
The median home price across Orange County was $450,000 last month, more than seven percent higher than a year ago. Sales volume was off more than 19 percent compared to the same period a year ago. Sales volume followed suit throughout Southern California in July, dropping more than 21 percent. The median price climbed more than 10 percent to $295,000 for the combined Orange, Los Angeles, Riverside, San Bernardino, Ventura and San Diego counties market. But that price was down $5,000 from June.
“Home price volatility and collateral risk remain very high. The stabilization phase and policy intervention since the spring of 2009 has run its course,” said Mark Fleming, chief economist for market analyst CoreLogic. “Prices are expected to further moderately decline as the economy remains weak through the fall.”
Mortgage interest rates hit record lows for the eighth time in nine weeks in mid-August, prompting homeowners to file the most mortgage refinancing applications in 15 months. The average rate offered on a 30-year fixed home loan had fallen to 4.42%. That's the lowest since Freddie Mac began its rate survey in 1971. Average rates in California were marginally lower.
Statewide Market Analysis
(From the California Association of Realtors)
The percentage of households that could afford to buy an entry-level home in California stood at 64 percent in the second quarter of 2010, compared with 67 percent for the same period a year ago, according to a report released today by CAR.
The minimum household income needed to purchase an entry-level home at $266,750 in California in the second quarter of 2010 was $43,960, based on an adjustable effective interest rate of 4.09 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 second quarter of 2010. At $43,960, the minimum qualifying income was $4,051 greater than a year earlier when households needed $39,909 to qualify for a loan on an entry-level home.
National Market Analysis
(From the National Association of Realtors)
The weak economy and continued high unemployment has been keeping housing markets cool across the country. As a result, the median price of a single-family home crept up just a percent and a half to $176,900 in the second quarter, according to a report by NAR.
"As long as people hold back, whether irrationally or rationally," said Lawrence Yun, NAR's chief economist, "then naturally there will be too much supply in relation to the demand, and that could lead to some over-correction in home prices."
"All year we've been seeing relatively flat national home prices, which appear to be supported by market fundamentals," Yun said. "We don't expect any consequential movement in home prices for the foreseeable future."
Latest Real Estate News Coverage
Laguna Woods and Orange County news
(From the Orange County Association of Realtors)
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