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Laguna Woods Market
Updated 5-16-2012
Laguna Woods home sales gained momentum in April. Sales volume in the community built on strong numbers in March to climb more than 11 percent compared to April 2011, according to MDA DataQuick, an independent market research firm.
The median price of a home in Laguna Woods stood at $231,250 in April, up more than 13 percent from the same period last year.
“The housing market continued its painfully slow crawl back toward normalcy last month. You can see it in the fading role of foreclosures, the uptick in median prices here and there, and the higher levels of sales in coastal counties,” said John Walsh, DataQuick president.
Orange County followed its best March in five years with a strong April as sales volume rose more than 17 percent compared to April 2011. The median home price was $420,000, down more than 2 percent from a year ago.
The pace of sales was up more than 5 percent throughout the rest of Southern California. The median price of a home was also up -- it gained more than 3 percent to $290,000 for the combined Orange, Los Angeles, Riverside, San Bernardino, Ventura and San Diego counties market.
“Of course, there are still a lot of things that make this market abnormal,” said DataQuick's Walsh. "Investor and cash buying are still unusually robust. The jumbo loan market has yet to recover, and the use of plain-vanilla adjustable-rate mortgages, or ‘ARMs,’ remains far below normal. Lots of homeowners are ‘underwater,’ and the market remains awash in uncertainty over the economy, home prices, and the way lenders will handle the many thousands of homeowners who are behind on their mortgage payments.”
Distressed sales – the combination of foreclosure resales and “short” sales – made up about half of last month’s resale market. But the distressed sale inventory has dropped by about half.
“Housing inventory remains extremely tight throughout the state and at levels severely under normal market conditions,” according to Leslie Appleton-Young, the state Realtor association’s chief economist.
Mortgage interest rates returned to near-record lows in April. The average rate on the 30-year fixed-rate mortgage remained below 3.8 percent -- not far above the lowest since Freddie Mac's data collection started in 1971.
Statewide Market Analysis
(From the California Association of Realtors)
California’s housing affordability rose to its highest level in fourth-quarter 2011, matching a record high set in 2009, thanks to lower home prices and record-low interest rates.
The percentage of home buyers who could afford to purchase a median-priced, existing single-family home in California rose to 55 percent in the fourth quarter of 2011, up from 52 percent in third-quarter 2011 and from 50 percent in the fourth quarter of 2010, according to CAR.
In other news, UCLA economists forecast statewide home prices rising steadily over the next six years, although the recovery in home sales isn’t projected to begin until 2013.
The UCLA Anderson Forecast calls California a "bifurcated" state, one in which the coastal regions continue to grow out of the depths of the recession, while the inland regions suffer from economic "doldrums."
The economists predicted that the median price of an existing single-family home will increase 52.5 percent by 2017, rising to $438,980.
Home prices are projected to turn around in 2012 — jumping 11.5 percent to $321,138, then rising 10 percent more in 2013 to $353,411. The recovery is expected to run through 2017.
But prices will remain below the housing market’s 2006 peak of $560,408 more than 10 years down the road.
National Market Analysis
(From the National Association of Realtors)
Housing affordability conditions have reached the highest level since recordkeeping began in 1970, according to NAR.
NAR’s Housing Affordability Index rose to a record high 206.1 in January, based on the relationship between median home price, median family income and average mortgage interest rate. The higher the index, the greater the household purchasing power.
An index of 100 is defined as the point where a median-income household has exactly enough income to qualify for the purchase of a median-priced existing single-family home, assuming a 20 percent downpayment and 25 percent of gross income devoted to mortgage principal and interest payments. For first-time buyers making small downpayments, the affordability levels are relatively lower.
NAR President Moe Veissi said this latest data underscores buyer opportunities in today’s market. “This is the first time the housing affordability index has broken the two hundred mark, meaning the typical family has roughly double the income needed to purchase a median-priced home,” he said. “For buyers who can qualify for a mortgage, now is a very good time to become a homeowner.”
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Laguna Woods and Orange County news
(From the Orange County Association of Realtors)
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