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Southern California February Home Sales Lowest Since 2008

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La Jolla, CA—Southland home sales dropped to the lowest level for a February in six years as many would-be buyers struggled with inventory constraints, credit hurdles and reduced affordability. The median price paid for a home edged up slightly from January and remained nearly 20 percent higher than a year earlier, a real estate information service reported.

A total of 14,027 new and resale houses and condos sold in Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties last month. That was down 3.1 percent from 14,471 in January, and down 12.0 percent from 15,945 sales in February 2013, according to San Diego-based DataQuick.

On average, sales have increased 0.7 percent between January and February since 1988, when DataQuick’s statistics begin. February sales have ranged from a low of 10,777 in 2008 to a high of 26,587 in 2004.

Last month’s Southland sales were 20.1 percent below the average number of sales – 17,560 – for February since 1988. Sales haven’t been above average for any particular month in more than seven years.

“February was another month with lackluster home sales, and the fifth in a row where sales fell short of the same month a year earlier. The March-through-May data will give us a better sense of what’s been holding back activity the most – supply constraints or the double-whammy of higher prices and higher mortgage rates. The drop in housing affordability is enough to nudge some out of the market. Other would-be buyers have no doubt called ‘time out’ while re-evaluating their housing priorities, or watching for signs the market has overshot a sustainable price level,” said John Walsh, DataQuick president.

“But there’s still reason to expect significant pressure on the market,” he added. “The economy is growing, creating jobs. People who lost homes to a short sale or foreclosure over the last eight years will be looking to buy again. On the supply side, inventory is increasing, as it normally does this time of year, but so far there hasn’t been an explosion of new listings, and new-home construction is still well below average.”

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