More Gains for Southern California Home Sales and Median Prices

Great article from DQnews.com

La Jolla, CA—The Southland housing market continued its long, step-by-tiny-step trek back toward normalcy in May, when the median sale price rose year-over-year for the second consecutive month, reaching a 20-month high. Home sales increased across the region but the gains were highest in coastal areas, where move-up markets have picked up steam, a real estate information service reported.

The median price paid for a home in the six-county Southland rose last month to $295,000, up 1.7 percent from $290,000 in April and up 5.4 percent from $280,000 in May 2011, according to San Diego-based DataQuick.

Last month’s median was the highest since the median was $295,500 in September 2010. The year-over-year gain in the May median followed a 3.6 percent annual increase in April. Before then, the median had fallen year-over-year for 13 straight months.

The rise in the median price is the result of higher demand and two other trends. First, there’s been a significant drop in the share of transactions that are foreclosed properties, which tend to sell at a discount and be concentrated in lower-cost areas. Second, a greater portion of sales are occurring in the higher-cost coastal markets. Last month, for example, sales in San Diego, Orange, Los Angeles and Ventura counties represented about 70 percent of all activity, up from 67.6 percent a year ago.

Last month’s total Southland sales rose nearly 21 percent compared with a year ago, and activity increased across the home-price spectrum. But the gains were strongest above $300,000. The volume of transactions in lower-cost markets has been restrained by, among other things, the dwindling inventories of homes for sale, especially foreclosures.

The number of Southern California homes sold in May for less than $200,000 rose 7.0 percent from a year earlier, while the number that sold for $200,000 to $400,000 increased 18.9 percent. Sales between $300,000 and $800,000 – a range that would include many move-up buyers – jumped 23.1 percent year-over-year. Sales over $800,000 rose 11.8 percent from May 2011.

“The market is being slowly nursed back to health by low interest rates, a modestly improved economy and, we suspect, a widening sense that the housing sector is at or near bottom. There’s still plenty of uncertainty swirling around out there. But it looks like more move-up buyers are concluding it makes sense in the long run to sell their homes now, even when it’s hard to swallow the price. The upside for many is a good deal on the next house, and the ability to lock in both a killer mortgage rate and a relatively low property tax base,” said John Walsh, DataQuick president.

For the full article, click here.

Property Tax Breaks for Seniors – Prop. 60/90

Under Proposition 90, California property owners who are 55 years or older may be able to qualify to transfer the assessed valued of their principal residence sold in County “A” to their new residence in County “B”.

The County Assessors will require a copy of the tax bill from the other county and a copy of the applicant’s birth certificate to be included with the application. Also include a copy of the grant deed for the new purchase and a copy of the closing statements of both sale and purchase.

Summary of eligibility requirements

  • The seller of the original residence, or a spouse residing with the seller, must be at least 55 years of age, as of the date that the original property is transferred.
  • The replacement property must be of equal or lesser “current market value” than the original.
  • The base year value of the original property cannot be transferred to the replacement dwelling until the original property is sold.
  • The replacement property must be purchased or newly constructed within two years (before or after) of the sale of the original property.
  • The owner must file an application within three years following the purchase date or new construction completion date of the replacement property.
  • This is a one-time only filing. Proposition 60/90 relief cannot be granted if the claimant, or spouse, was granted relief in the past.
  • Proposition 60/90 relief includes, but is not limited to: single family residences, condominiums, units in planned unit developments, cooperative housing, corporation units or lots, community apartment units, mobile homes subject to local real property tax, and owners’ living premises which are a portion of a larger structure.
  • The taxpayer is not eligible for the tax relief until they actually own AND occupy the replacement dwelling as their principle residence.

Alameda (415) 272-3755  San Mateo (415) 363-4500  Santa Clara (408) 299-4347

Orange (714) 834-2746  Los Angeles (213) 974-3101 Ventura (805) 654-2181

San Diego (619) 531-5507

It is essential that you call the co-operating County in question, to verify that they are currently accepting the value transfer under Proposition 90, and what their requirements are. If you have any questions, the property tax office in Sacramento for all counties in California may be reached by calling: (916) 445-4982 or click here for frequently asked questions.

The information set forth herein is intended as an overview and should not be construed as legal, financial, or tax advice. Consult your tax professional.