Los Angeles Market Trends July 2014

The Credit Crisis of 2007 and ensuing economic recession has substantially impacted Southern California market conditions. Case Shiller index reports a 19.9% decrease in the Los Angeles MSA home price index from 273.94 in September 2006 to 219.47 in April 2014. The index has remained relatively stable from October 2013 to April 2014. See Chart

Taken from : http://www.calmis.ca.gov/file/lfmonth/la$pds.pdf

LOS ANGELES-LONG BEACH-GLENDALE METROPOLITAN DIVISION

(LOS ANGELES COUNTY)

“Nonfarm employment up by 4,800 jobs over the month; up 88,800 jobs over the year

The seasonally adjusted unemployment rate in Los Angeles County decreased over the month to 8.1 percent in June 2014 from a revised 8.2 percent in May 2014 and was below the rate of 10.0 one year ago. Civilian employment increased by 11,000 to 4,587,000 in June 2014, while unemployment decreased by 4,000 to 404,000 over the month.

The civilian labor force increased by 5,000 over the month to 4,990,000 in June 2014. (All of the above figures are

seasonally adjusted.) The unadjusted unemployment rate for the county was 8.2 percent in June 2014.

The California seasonally adjusted unemployment rate was 7.4 percent in June 2014, 7.6 percent in May 2014, and 9.0 percent a year ago in June 2013. The comparable estimates for the nation were 6.1 percent in June 2014, 6.3 percent in May 2014, and 7.5 percent a year ago.”

Dataquick reports:

"Southland Home Sales Down from Last Year Again; Price Gains Throttle Back

July 15, 2014

La Jolla, CA---Southern California homes sold at the slowest pace for a June in three years as investor purchases fell again and other would-be buyers continued to struggle with inventory and affordability constraints. The median price paid for a home rose to its highest level in 77 months but the single-digit gain from a year earlier was the smallest in two years, a real estate information service reported.

A total of 20,654 new and resale houses and condos sold in Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties last month. That was up 5.6 percent from 19,556 sales in May, and down 4.4 percent from 21,608 sales in June last year, according to DataQuick, which is owned by Irvine-based CoreLogic, a leading global property information, analytics and data-enabled services provider.

On average, sales have increased 6.4 percent between May and June since 1988, when DataQuick’s statistics begin. Sales have fallen on a year-over-year basis for nine consecutive months. Sales during the month of June have ranged from a low of 18,032 in June 2008 to a high of 40,156 in June 2005. Last month was 23.7 percent below the June average of 27,069 sales. Sales haven’t been above the long-term average for more than eight years.

“Pent-up demand, job growth and still-low mortgage rates continue to put pressure on home prices. But they’re climbing at a much slower pace than a year ago. In many markets price appreciation has slipped into the more sustainable single-digit range, compared with gains exceeding 20 percent this time last year. Why the drop-off? The supply of homes for sale, while still low in an historical context, is higher this year, and the decline in affordability serves as gravity for home prices. People can’t stretch with exotic and risky loans the way they could during the last housing boom,” said Andrew LePage, a DataQuick analyst.

“Many of the market indicators we track continue to ease toward normalcy,” he added. “For example, the use of larger, so-called jumbo loans is up significantly this year, as is the use of adjustable-rate mortgages. Distressed property sales are way down and, related to that, investor and cash purchases are trending lower, toward more normal levels.” ”