It’s not getting any cheaper to buy a home in Los Angeles County. Prices leapt up 3.2 percent in May, according to a new report from real estate tracker CoreLogic.
For the fourth month in a row, the county’s median home price bested an all time record. It now stands at $609,000—nearly $20,000 higher than a month ago. Prices were also up 8.4 percent over a year ago, and May was the first time ever that the LA median eclipsed the $600,000 mark.
In spite of those soaring prices, homeowners aren’t exactly rushing to sell their properties. According to CoreLogic analyst Andrew LePage, fewer homes are on the market than usual, and the number of overall sales is down 4.2 percent since May of last year.
LePage says the dramatic increase in home values over the last year “tells only part of the story of waning affordability, where housing costs have outpaced income gains.”
That’s because mortgage interest rates have increased roughly 0.5 percent in that time, inflating monthly costs for buyers. LePage points out that mortgage payments across all of Southern California have grown about 16 percent over the last year, making things especially tough for buyers with limited finances available.
As evidence of that, the number of new homeowners making use of government-backed FHA loans for first-time buyers is down significantly since last year. Across all of Southern California, these loans were used in 18.6 percent of home sales in May of 2017. Last month, that share was down to 12.9 percent.
On the flip side, region-wide sales of homes priced over $1 million are up nearly 8 percent since last year.
- It takes a salary of over $110K to afford a typical home in LA [Curbed LA]
- LA housing prices break another record [Curbed LA]
- What do rising interest rates mean for homeowners? [Curbed LA]