Prices keep dropping, foreclosures continue rising
Amid the worst foreclosure crisis since the Great Depression, house sales in Southwest Riverside County boomed during December, according to data from a local real estate company.
Analysts said low prices on foreclosed homes attracted buyers in droves, offering a rare bright spot in an otherwise gloomy housing market for sellers. Still, the region's average price fell.
For the first time in more than a decade, buyers purchased more homes in December than during any summer month -- a rarity because residents tend to prefer moving during the summer, according to data from the Multi-Regional Multiple Listing Service and MDA DataQuick, two real estate research firms.
Sales during "December came roaring back, and the way the year ended up overall is nothing short of phenomenal," said Gene Wunderlich, a real estate agent in Wildomar.
Buyers purchased 1,136 homes last month, up 329 percent from a year ago.
Even by standards set during the housing bubble through 2005, last month's sales were high: December's sales total represented a 66 percent jump from the recent peak for the month, set in 2003.
At the same time, prices continued to soften.
From a year ago, the average price of a home in the area fell 31 percent to about $250,000. In North San Diego County, the median price was $375,000 in December while sales were up a relatively modest 59 percent from a year ago to 693.
And Wunderlich said consumers could expect price drops to continue.
While a crush of buyers took the plunge, just as many Southwest Riverside homeowners received foreclosure notices.
Last month, banks mailed to local homeowners 1,328 notices of default -- the first step in the foreclosure process, meaning the homes are not yet up for sale.
"We're not out of the woods yet," Wunderlich said. "But we're not just going into the woods, either. We're at least part of the way through."
Beyond the foreclosures expected to hit the market, some homeowners who want to move might not be willing to list their homes for sale until the market shows signs of recovery.
In a part of Oceanside, 85 percent of all homes listed for sale last month were either a foreclosure or a short sale, where homeowners sell the property for less than the amount owed on the mortgage. Wunderlich said the portion is even higher in Southwest Riverside, where he estimated as much as 90 percent of all sales were so-called distressed properties.
Because of that weakness, mortgage broker Nelson Sales, based in Temecula, said some potential buyers have decided to sit back and wait on putting an offer for a house.
"A lot of buyers are holding off, thinking it will still go down," he said. "And it will still go down."
Contact staff writer Zach Fox at (760) 740-5412 or zfox@nctimes.com.
Posted in Business on Friday, January 23, 2009 12:00 am Updated: 10:02 am. | Tags: T.m.housing.final.24, Nct, Business, Local, Z.google.business
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