47% increase in Orange County housing payments cuts prices 5.1% from their peak – Orange County Register
Orange County home buying has cooled off this summer.
August sales were 31% down year-on-year as home seekers were deterred by 47% higher home payments. Home prices in Orange County are down 6.6% from their spring peak.
Here’s what my trusted spreadsheet found in DQNews’ August Closed Home Purchases Report in Orange County…
sale
The balance: 2,546 single family, condominium, existing and new construction homes sold in Orange County. This was the third slowest August of the 35 since 1988.
One-month change: 12% increase over July. Since 1988, August sales are down 35%, with an average increase of 3.9% over July.
12-month change: 31% drop – #21 biggest drop since 1988 (or just 5% worse months).
summer slump: It’s not just a month. The 7,592 homes sold from June to August were 34% cheaper in a year and the second slowest mid-summer of the 35 since 1988.
Prices
The median: $984,000 for all homes fell 1.6% in a month while rising 9% over 12 months.
Record OC high? $1,054,000 fixed in May. So prices are down 6.6% from their peak.
One Month Trend: Since 1988, prices have fallen 31% of the time in a typical August, with an average decline of 0.52%.
one-year trend: Smallest increase in 16 months. Average profit since 1988? 5.3% annualized.
Key OC Slices
Existing single-family homes: 1,631 sold, down 31% in one year. The median of $1,126,000 is up 10% over 12 months.
Existing condominiums: 713 sales, down 33% in 12 months. The median of $705,000 was up 9% in one year.
Newly built: Builders sold 202 new homes, down 27% in one year. The median of $969,500 was down -4% in 12 months.
Builder share: 7.9% of sales versus 7.5% last year.
Prices
How expensive has money become? Interest rates on a 30-year fixed-rate mortgage averaged 5.38% in the three months to August, up from 2.90% a year ago. That means 26% less purchasing power for those looking for a home – the biggest drop since 1971.
Payment pain: The change in prices meant a buyer paid $4,412 per month for OC’s $984,000 residence in August, while paying $2,996 monthly for last year’s median $900,000. So prices went up 9% compared to a 47% increase in home payment.
Down payment: OC’s 20% drop over the past month totaled $196,800, up $16,800 in one year.
bigger picture
Southern California: 17,698 homes — sold in six counties, up 8% for the month and down 28% over the past year, according to a DQNews report. The region’s median price of $740,000 was flat for the month and up 9% over 12 months.
What do sellers think? Entries have increased dramatically. In August, there were 28,286 homes for sale across the four boroughs — up 61% from December, Redfin figures show.
What is the industry thinking? Local real estate chiefs cooled hiring — 600 workers were added in the four counties in August, up from an average of 1,240 workers added monthly last year.
What do landlords think? Rent increases are slower — $8 more for a typical Southern California apartment in August versus $13 the average for the last six months. And six of the 21 major cities have had falling rents, ApartmentList data shows.
Jonathan Lansner is a business columnist for the Southern California News Group. He can be reached at jlansner@scng.com
https://www.ocregister.com/2022/09/27/47-jump-in-orange-county-house-payments-cuts-prices-5-1-from-their-peak/ 47% increase in Orange County housing payments cuts prices 5.1% from their peak – Orange County Register
