The region's revitalized housing market sizzled in March, a report released Monday showed, with the average price for a single-family home in Los Angeles County jumping 2.9 percent from February.
A combination of fewer homes on the market and increased demand pushed the median price of single-family homes in the county to $180,600, the California Association of Realtors said, up from $175,500 in February. The figure was also up 5.8 percent from March 1997."Pent-up demand, a robust economy and unbridled optimism for the future are pushing home prices upward," said association President Tim Corliss.
Those conditions meant a robust market for homes. Sales activity in the county surged 45.3 percent from February - traditionally one of the slowest months - and 20.2 percent from March 1997.
Home prices began to rally last year as buyers gained confidence that the market was strengthening. That led, in turn, to some reluctance among owners to put their homes on the market. Statewide figures showed March's inventory fell to 5.2 months - the amount of time to deplete the supply of homes at the current sales rate - from 8.2 months in March 1997.
And in a particularly telling statistic, the average number of days it took to sell a California home in the resale market fell to 41 days in March from 58 days in March 1997.
Local real estate brokers have been reporting that the housing market has swung radically in favor of sellers in recent months, instilling a sense of urgency among prospective buyers.
"Six months ago they had a leisurely attitude that if they didn't make an offer on a house today, it would still be there two, three or four weeks later," said Joe Andrews, co-owner of All Properties-Century 21 in the suburb of Chatsworth. "But literally, the house I look at today may not be here tomorrow."
Statewide, March's median price for an home - meaning half sold for more and half for less - was $196,000, up 5.4 percent from February and 10.5 percent from a year earlier. The state's resale activity, adjusted for seasonal factors, was down 3.4 percent from February but up 14.8 percent from a year ago.
The month-to-month gain in sales activity was even more pronounced in Orange County, posting a gain of 69 percent.
"The California housing market, particularly in the San Francisco Bay Area in the north and in Orange County in Southern California, continues to be one of the hottest in the nation," said Leslie Appleton-Young, vice president and chief economist of the trade group.
"Highly compensated high-tech and business-services jobs, and jobs in the entertainment sectors are providing the natural foundation for continued demand for housing, despite upward price pressure."
The jump in prices, both locally and statewide, reflects a lack of new-home construction, said G.U. Krueger, an economist with the trade group. "A lot of demand and little supply equals rising home prices," he said.
Krueger said a possible interest rate hike by the Federal Reserve Board next week would likely spur more buying, as would-be homeowners scramble to lock in rates still low by historical standards.
The Federal Home Loan Mortgage Corp. has reported that 30-year fixed mortgage interest rates averaged 7.13 percent during March, down from 7.9 percent in March 1997. Adjustable mortgage interest rates averaged 5.69 percent in March 1998, up slightly from 5.64 percent in March 1997.
Nationally, the median price of single-family homes was $127,000 in March.