Southern California Median Home Price Drops Nearly 34 Percent

The median home price in a six-county region of Southern California dropped nearly 35 percent in December from a year ago, but home sales rose steadily as buyers snapped up low-cost foreclosures, a real estate tracking firm reported Monday.

The median price for homes and condos tumbled to $278,000 last month from $425,000 in December 2007, San Diego-based MDA DataQuick said. The median price for the area peaked at $505,000 in mid-2007.

There were 19,926 homes sold last month, up 19 percent from November. Foreclosures accounted for 55.7 percent of December's sales in Southern California.

The drop in the median home price overstates what's going on in Southern California because foreclosures in the more affordable inland markets, such as Riverside and San Bernardino counties, account for a large share of sales, while more expensive homes aren't selling briskly, the firm said.

For instance, nearly 70 percent of home sales in Riverside County were foreclosures in December, almost tripling from a year ago from 1,238 to 3,617.

The firm also reported new home sales plummeted and were the lowest on record for the month of December since 1988. A total of 1,813 new homes were sold last month. The December average for new home sales has been 4,926.

"The builders are in a holding pattern, staying alive until the market recovers," said John Walsh, president of MDA DataQuick. "Mortgage interest rates last month were near record lows. Of course, that doesn't mean much if the money isn't actually being lent. It does look like the spigot is being opened a little bit, at least for low-cost home purchases."