California Home Prices Decline 41% on Foreclosures

California Home Prices Decline 41% on Foreclosures (Update1) Share | Email | Print | A A A By Daniel Taub March 25 (Bloomberg) -- California home prices dropped 41 percent last month from a year earlier, more than double the U.S. decline, as surging foreclosures drove down values, the state Association of Realtors said today. The median price for an existing, single-family detached home in... [more]

California Home Prices Decline 41% on Foreclosures (Update1) Share | Email | Print | A A A By Daniel Taub March 25 (Bloomberg) -- California home prices dropped 41 percent last month from a year earlier, more than double the U.S. decline, as surging foreclosures drove down values, the state Association of Realtors said today. The median price for an existing, single-family detached home in California sank to $247,590 in February from $418,260 a year earlier, the Los Angeles-based group said in a statement. The U.S. median price fell 16 percent during the same period, the second-biggest drop on record, according to the National Association of Realtors. Home prices have been falling since their 2006 peak, pushed down by rising foreclosures blamed for the U.S. credit crisis. California, the most populous state, has one of the highest rates of foreclosure, according to RealtyTrac Inc., an Irvine, California-based seller of real estate data. Lenders usually sell foreclosed properties at a discount, dragging down the median price, so it doesn’t necessarily reflect the value of most homes, the California Association of Realtors report said. “The median, for all its imperfections, tells a really interesting tale right now,” Andrew LePage, an analyst at research firm MDA DataQuick, said in an interview. “It tells you what is and what is not selling. What’s selling right now is foreclosures.” Foreclosures accounted for 58 percent of existing California home sales in February, compared with 33 percent a year earlier, according to San Diego-based MDA DataQuick. Inland California, where prices are lower than coastal areas, accounted for half the state’s mortgage defaults in the last three months of 2008, MDA DataQuick said. ‘Distressed’ Homes “The California median price has declined by a larger margin than the nationwide median price,” Leslie Appleton- Young, chief economist for the California Association of Realtors, said in today’s statement. “This can be attributed to the under $500,000 portion of the market, which has experienced larger price declines than the other market segments due to the large share of distressed homes for sale.” The California price drop led to an 83 percent increase in the number of houses sold in February from a year earlier, the state association said. The number of existing, single-family detached homes sold jumped to 620,410 on an annualized basis, up from 338,970 a year earlier. Sales dropped 0.8 percent from January. Supply Declines The median number of days it took to sell a single-family home in California was 51.5 last month, down from 69.3 a year ago, the association said. The number of months needed to deplete the supply of homes on the market at the current sales pace dropped to 6.5 months from 15.3 months a year ago. California’s most expensive region for homes last month was Santa Barbara County’s south coast, where the median fell 45 percent from a year earlier to $715,000. The least expensive region was the High Desert, where the median dropped 45 percent to $121,970, the Realtors’ group said. Home sales in the High Desert more than tripled last month from the previous year, while sales in Santa Barbara’s south coast fell 9.4 percent. The median condominium price in California was $219,960 in February, down 40 percent from $367,540 a year earlier, the Realtors’ report said. The number of condo sales rose 52 percent from a year earlier. To contact the reporter on this story: Daniel Taub in Los Angeles at dtaub@bloomberg.net. Last Updated: March 25, 2009 13:10 EDT [less]