Sales increased 21% in May in Southern California, with prices up 5.4%. Factors behind the rebound include very low mortgage rates, an improving economy and a belief that home values are near bottom.
It looks like big media is finally catching on to what I’ve been seeing out in field: the L.A. market is heating up — drastically!
The LA Times reported today Southern California home sales accelerated sharply in May and prices improved for the second consecutive month, mirroring a national trend and providing fresh evidence that housing is recovering from its five-year slump.
Several factors are driving the rebound, including bargain-basement mortgage rates, a slowly improving economy and a growing consensus that housing prices are at or near bottom.
Declining foreclosures are another factor. The glut of repossessed houses being sold at fire-sale prices served as a drag on home values overall, but banks are taking back fewer homes compared with a year ago. A report by RealtyTrac being released Thursday shows that statewide foreclosure filings last month were down 19% from a year ago, and national foreclosure filings dropped 4%.
DataQuick President John Walsh, however, said the gains in the “move-up” market were significant, because it suggests more buyers will be entering the market.