Homebuying revival? Southern California sales, prices take record jumps in February

Has Southern California’s housing market awoken from its lengthy slumber?

My trusty spreadsheet, peeking at February’s CoreLogic sales stats, found these record-setting nuggets …

Sales: The 12,430 transactions completed in the six-county region – involving existing and new residences, homes and condos – represented a 17% jump from January. That’s the largest January-to-February increase in a database dating to 1988.

Pricing: The buying binge helped nudge Southern California’s median selling price up 5% to $740,000. This, too, is the biggest January-to-February gain on record.

Timely twist

February may not be seen as a hot month for homebuying, but it has seen noticeable upticks in sales and prices just before the traditional spring rush. Just ponder the previous 36 years.

Southern California sales have increased from January in 21 years. February’s average sales change is a 1.5% gain, making it the sixth-best month.

As for pricing, Southern California’s median has risen 28 times in February since 1988 – with an average price hike of 1.2%, the third-best month.

Now, let’s remember that one month does not make a trend. Still, the sales escalation is eye-catching, considering that Southern California suffered its slowest two-year homebuying pace on record between 2022-23.

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Leading this February’s one-month purchasing pop were sales of new homes, up 29%. Southern California builders have succeeded because they have homes to sell, and they’ve been aggressive with concessions to buyers – notably, cut-rate financing. Sales of existing condos were up 23% in February while existing house sales rose 15%.

February’s buying boost can be linked to the bottoming of mortgage rates in late 2023. House hunters may have rushed to close deals as rates rose at the start of 2024.

Plus, buyers may have noticed weaker pricing. Southern California’s home prices took their biggest 2-month dip in 12 years in December and January.

And don’t forget that leap year that added a day to conduct business, too.

Also, let’s remember any sales increase isn’t that surprising, considering just how slow Southern California homebuying has been.

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Despite the record one-month sales bump, this was the third-slowest-selling February since 1988 – and 27% below average. Southern California housing remains very unaffordable.

Locally speaking

Here’s how the six counties fared in February, ranked by the month’s sales gains …

San Diego: 2,132 sales, up 27% from January – the No. 1 increase over 37 years vs. 7% average one-month gain since 1988. This was the fifth-slowest February over 36 years and 26% below average. The county’s median price rose 3% to $825,000 (No. 4 gain in 37 years) vs. 1.2% average increase since 1988.

Ventura: 434 sales, up 25% from January – No. 2 increase vs. 3% average gain. Second-slowest February, 41% below average. Median rose 3.1% to $823,500 (No. 7 gain) vs. 0.2% average increase since 1988.

Orange: 1,775 sales, up 24% from January – No. 2 increase vs. 4% average gain. Third-slowest February, 29% below average. Median rose 4.3% to $1.11 million (No. 6 gain) vs. 1.5% average increase since 1988.

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Riverside: 2,576 sales, up 14% from January – No. 4 increase vs. 5% average gain. 15-slowest February, 8% below average. Median rose 3.2% to $567,500 (No. 13 gain) vs. 2.4% average increase since 1988.

San Bernardino: 1,767 sales, up 14% from January – No. 3 increase vs. 1% average decline. 11th-slowest February, 18% below average. Median rose 3.2% to $490,000 (No. 14 gain) vs. 1.8% average increase since 1988.

Los Angeles: 3,746 sales, up 12% from January – No. 1 increase vs. 2% average decline. Third-slowest February, 36% below average. Median rose 5.6% to $845,000 (No. 1 gain) vs. 0.5% average increase since 1988.

Jonathan Lansner is the business columnist for the Southern California News Group. He can be reached at jlansner@scng.com

Source: Orange County Register