Business & Economy

Southern California home prices on the decline

Home for sale.
Home for sale.
Tim Boyle/Getty Images

Southern California home prices continued a downward trend in comparison to prices a year ago, a tracking firm said Wednesday.

San Diego-based DataQuick said the median home price of $279,000 for the six-county Southern California region fell 3.1 percent from $288,000 in August 2010 and dropped 1.4 percent from $283,000 in July. Home prices have underperformed in month-to-month comparisons since March.

DataQuick said that, despite dropping prices, the number of houses sold in August increased by 6 percent from 18,541 in August 2010 to 19,654 this year. July saw an increase of 8.6 percent.

The firm noted that the increases are at least partly due to the relatively high number of business days last month. The number of homes sold per day in August fell 6 percent from the month-ago average and rose less than 1 percent from a year ago.

"Scratch beneath the surface and there's not a lot to cheer about this month," DataQuick President John Walsh said in a news release. "Many would-be buyers can't find financing, and others who want to make a move now are stuck because they owe more than their homes are worth."

Although home sales are sluggish overall and down in the upper price ranges, sales of homes in the under-$300,000 segment rose 10.2 percent in August from a year earlier, the firm noted.

Many of those homes are foreclosures or short sales, which made up more than half of last month's sales.

Foreclosures accounted for 34.6 percent of August's sales, up slightly from 34.5 percent in July but down from 37.6 percent a year earlier.

Short-sale transactions, in which lenders allow homes to be sold for less than what is owed on them, accounted for 17.9 percent of existing home sales. That was up from 17.3 percent in July but down from 18.9 percent a year earlier.

Walsh said fears of continued troubles in the broader economy were keeping the housing market from recovering more rapidly.

"Financial markets are increasingly choppy, the political outlook is incredibly murky, and consumer confidence remains poor," he said. "It's not an environment ripe for stabilizing the housing market."