Prices Inching Up as Fall’s Arrival Cools Activity

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Home prices rose 7 percent on average in Los Angeles County last month, despite a slump in sales activity as the summer drew to a close.

The median price for a home sold in September was $359,000 compared with last September’s average of $335,000, according to HomeData Corp. in Melville, N.Y. The number of homes sold totaled 3,701, a decrease of 17 percent compared to September 2009 after adjusting for the number of selling days.

Compared with August, the September numbers represent a 1 percent gain in home price; there was a month-to-month decrease of 5 percent in sales activity.

Gary Painter, associate professor at the USC Lusk Center for Real Estate, explained the higher prices and slower activity in terms of people’s motivation for selling their home. During the housing crash, the market was flooded with foreclosed properties, resulting in depressed prices.

“Over time, people start selling for more traditional reasons – moving up to a bigger home, a job switch or better schools,” Painter said. “As more non-distressed homes come on the market, we will see higher prices.”

West De Young, an agent with Dilbeck Realtors in South Pasadena, said there’s normally a housing slowdown in September as people with children settle in for the school year, but this September the decrease was more than usual. De Young blamed the “nosedive,” as he called it, on a lack of homes in the right price categories.

“Inventory – we just don‘t have a lot of it,” he said.

In general, homes that qualify for conforming loans, generally less than $729,750, are scarce and selling briskly, De Young said. In contrast, upscale homes, which require so-called jumbo loans, normally sit on the market for 10 to 12 months before selling.

“The jumbo market is not healthy yet,” he said. “It’s 20 to 30 percent down and then the planets have to align for a loan to happen.”

In the condominium market, the September average price of $300,000 was down a slight 3 percent from $310,000 in September 2009. A total of 1,325 condo units changed hands last month, a decrease of 15 percent since last September after adjusting for the number of selling days.

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