CA Home Sales – May 2009

The greatest story never told continues to be the remarkable stability in Southern California’s home prices (ground zero for the housing bubble). Home prices rose a modest 0.8% last month and have essentially been flat since the beginning of 2009 (though over 50% off its peak levels). While California remains way over-inventoried, with a high level of foreclosures still in the pipeline, year-over-year transactions remain brisk (up 23% last month) suggesting that the inventory is finally starting to clear. This stable pricing, despite foreclosures sales representing over 50% of transactions (which undoubtedly weigh on home pricing), suggests the market is firmly in the healing stage.