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Home prices soar across Southern California

Southland home prices are sizzling this summer. Prices in the Los Angeles metro area are up 19 percent from a year ago, according to a widely watched index released Tuesday. In the San Fernando Valley, the median price of a previously owned home soared a record 39 percent in May and cracked the half million mark again, a trade group said. And San Bernardino County’s median price jumped 28 percent last month, according to market tracker DataQuick. Sale volume is showing signs of life, too. A report issued Tuesday by the U.S. Census Bureau and the Department of Housing and Urban Development said that sales of new home in May increased 29 percent to an annualized rate of 476,000 units from 366,000 a year earlier. May’s total was the highest in five years, the department said. It adds up to a housing market recovery gaining steam. “I think it’s on track and firmly entrenched,” said David Blitzer, chairman of the Index Committee in charge of Standard & Poor’s/Case-Shiller Home Price Index. The April index for Los Angeles, the most current, shows that Los Angeles area prices increased 18.8 percent from 2012 and were up 3.4 percent from March. By comparison, the index that tracks 20 major metro areas was up 11.6 percent from a year ago. For Los Angeles, it’s the biggest gain since the index jumped 20.5 percent in February 2006 as prices were climbing toward their zenith before the price bubble deflated. This market is not in for a repeat performance — yet, Blitzer said. “I think there may be some small additional gains but the rate of increase has to level off pretty soon or we’re back to the bubble. But I don’t think we are at the bubble at this point,” he said. Price increases across the region are being fueled by scant inventory, a sharp drop in foreclosure activity, an increase in sales of more expensive properties and a decrease in sales of lower priced homes. Although the Case-Shiller index lags the market by a month, it’s relied upon as a good price marker. “I think the index gives you a somewhat more pure view of how prices are adjusting in the market,” said Robert Kleinhenz, chief economist at the Kyser Center for Economic Research in Los Angeles. Competition among buyers is heating up, too. “Extremely lean supply is bumping up against strong demand...
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Rising home prices in the SW Valley AZ pushing out investors

As warm weather signals the start of the peak homebuying season, Southwest Valley buyers will see higher prices but less competition from cash-wielding investors, experts say. Plus, there are more signs that the Southwest Valley is shaking off the Great Recession’s housing slump. Homebuilders are buying more lots in communities where the original developer installed utilities and built roads but never built houses. The housing figures are part of a March report released by the Center for Real Estate Theory and Practice at the W.P. Carey School of Business at Arizona State University. Rising home prices in the Southwest Valley and throughout metro Phoenix have prompted investors to go elsewhere for a good deal, Avondale real-estate agent Joe Bourland said. “The good house for $70,000 has gone,” Bourland said, adding that out-of-state markets, such as Las Vegas and Atlanta, still offer homes at much lower prices. Investors move out The median price for single-family homes surged more than 30 percent from February 2012 to February 2013 in many Southwest Valley cities, according to ASU figures. The increases ranged from 39 percent in Buckeye, where the median price grew from $95,000 to $130,000, to 33 percent in Litchfield Park. There, prices rose to $230,000 from $172,000 over the 12-month period. In 2012 the percentage of Maricopa County homes bought by investors fell from 37 percent in February 2012 to 30 percent in February 2013. That is good news for traditional buyers, who have have had a tough time competing with investors. Mark Haldane recently purchased a home in Goodyear after he got a job at the Perryville State Prison. After Haldane and his wife sold their Maricopa home, the couple didn’t want to risk getting outbid by rival buyer when they found a house listed for $160,000 in Estrella Vista. They offered to pay the full price the seller wanted instead of offering to pay a little less and haggling to get a better deal. “I noticed that homes weren’t staying on the market very long,” Haldane said. When prices were at their lowest, investors who could pay cash could complete a transaction in less than 15 days, Bourland said. It wasn’t uncommon for sellers to receive a dozen offers from investors. Other homebuyers, who usually put less than 20 percent down and had to go through a longer process, often lost out to investors with cash in hand. The...
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