Southern California Home Prices Hit 4-Year Low
RENEE MONTAGNE, host:
Housing prices are slipping across the country, but nowhere are they sliding as fast or as steeply as here in California. Specifically, here in Southern California, which holds the national record for the most foreclosures and the fastest depreciation. Here's NPR's Karen Grigsby Bates with more.
KAREN GRIGSBY BATES: The figures pretty much said it all. DataQuick Information services, a California public property database, released their numbers from March and they were not pretty. The median price of Southern California homes dropped 24 percent last month. Many Californians had gotten used to enjoying an average home value increase of 38 percent for the past 20 years. They're still trying to absorb the downturn.
Mr. ANDREW LEPAGE (DataQuick Analyst): Indeed prices don't always go up and as we've seen before in California, they can certainly come down.
BATES: That's Andrew LePage, a DataQuick analyst. LePage says the credit crunch that began with the meltdown of the subprime banking industry is one factor in the current housing slump. So is the fact that the so-called jumbo loans, loans above $417,000, have become harder to get until recently when the FHA raised the maximum for those loans, which are based on area home values. Then there's the record number of foreclosures depressing the value of other homes on the market. That's a lot of grim news, but LePage says there is a silver lining.
Mr. LEPAGE: A lot of people like to cast this as a very gloomy story, but the news just keeps getting brighter for first-time buyers.
BATES: LePage says making jumbo loans easier to secure might increase upper-end home sales, which could boost the median market.
Mr. LEPAGE: But they - you know, you could be back up to much closer to average levels and then you could see the median sale price climb pretty fast.
BATES: Of course, median is relative. In Southern California last month, the median house sale price was $385,000. The same time last year, it was a half million dollars.
Karen Grigsby Bates, NPR News.