Thursday, July 16, 2009

June DataQuick

After five flat months DataQuick's Los Angeles County median price ticked up for June. Which as we know has little relationship with Westside prices beginning to fall, and as Calculated Risk wrote, "Note: Ignore the median home price during periods of rapidly changing mix."

Median prices are down 41.8% for Los Angeles County from its peak in August 2007. Volumes were up 34% year-to-year from June 2008. (
May DataQuick
post)

I wonder if this is indicative of the recent but now subsided flurry of lower-priced sales in Mar Vista and the typical peak of sales and price jumps in the second quarter of the year, not a longer trend.

This leaves Los Angeles County prices at May 2003. For the other three counties, Orange County is at June 2003, Ventura County at April 2003, and San Diego at May 2002.

9 comments:

Anonymous said...

I'm not an expert, but I thought this was b/c of the foreclosure moratorium. If you temporarily stop the bottom portion of sales, the median will go up.

Anonymous said...

So if median price has little relationship to Westside prices, why have you spent so much time bothering to post this data over the past few years? Who cares what the rest of LA is doing when we all know that the Westside has a lot further to fall.

blahblahblah said...

Since a huge decline in Westside prices would still be above the average for LA, a collapse in Westside price would cause a RISE in the LA average price (all other factors being equal).

Just an example: if a $3MM Montanna home gets foreclosed on and sold for $1MM, that $1MM is still significantly higher than the LA $320k avergae price. Therefore, a theoretical decline of 67% for the Montanna home would still cause an INCREASE in the LA average price. (not sayinf montanna homes will drop 67%, but i can dream, cant i?)

Anonymous said...

It is also important to remember that one month's data doesn't equal a trend...

tbgpalisades said...

median price ticked up for June. Which as we know has little relationship with Westside prices beginning to fall

It might have everything to do with Westside prices falling. As you indicate, more sales in higher priced communities is driving up the median. We're seeing more sales as some sellers are pricing more aggressively (on the downside). In fact, this has been reported in many outlets.

We'll get the true picture in less than 2 weeks when Case-Shiller reports.

Westside Bubble said...

why have you spent so much time bothering to post this data over the past few years?

I started regularly reporting DataQuick and S&P/Case-Shiller in September 2007 - back when DataQuick still hadn't shown any price reductions, although Case-Shiller had begun to.

What a difference since then! Median price is a very imperfect indicator, but worth following because the media does.

Anonymous said...

How can you know that prices will be lower one year from now? Who can tell that? We do know that unemployment is at 11% and the loss of good paying middle iincome jobs are being felt....but how does that affect the Westside?

I am a research person, and I while I appreciate the Case Shiller trends as much as the next person....It doesn't attempt to accurately depict future trends.

NO ONE can accurately tell us what next year westside real estate will be.....

Anonymous said...

"We do know that unemployment is at 11% and the loss of good paying middle iincome jobs are being felt....but how does that affect the Westside?"

Gotta agree with the above. After the initial bump of laid off folks, pay freezes, and cut bonuses, it is back to business as usual. Bonuses are back on track (even if more modest) for execs, attorneys, and bankers, and deal flow and clients are picking up.

The end result will be same - there are those with good incomes and savings who can afford to own, can get credit, and those who can't. Same story, different house prices.

Westside Bubble said...

How can you know that prices will be lower one year from now?

I'll do an updated post soon on the reasons I expect Westside prices to continue to fall.