August home sales take a major plunge: despite dropoff, median prices are holding steady.The expanding mortgage crisis and credit crunch Credit Crunch An economic condition whereby investment capital is difficult to obtain. Banks and investors become weary of lending funds to corporations thereby driving up the price of debt products for borrowers. slammed the Los Angeles Los Angeles (lôs ăn`jələs, lŏs, ăn`jəlēz'), city (1990 pop. 3,485,398), seat of Los Angeles co., S Calif.; inc. 1850. housing market in August, with home sales plunging plunge v. plunged, plung·ing, plung·es v.tr. 1. To thrust or throw forcefully into a substance or place: 50 percent from the same month last year and 25 percent from July. Sales of new and existing homes in Los Angeles County slid to 4,107 units in August, just under half the 8,246 units that sold in August 2006 and well below July's 5,458 units, according to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. figures compiled for the Business Journal by Melville, N.Y.-based HomeData Corp. The pain was widespread, as only a handful of the county's nearly 300 ZIP codes zip code System of postal-zone codes (zip stands for “zone improvement plan”) introduced in the U.S. in 1963 to improve mail delivery and exploit electronic reading and sorting capabilities. managed to eke out eke out Verb [eking, eked] 1. to make (a supply) last for a long time by using as little as possible 2. any sales gains. August's plunge The term Plunge has multiple meanings:
The number of houses that changed owners represents the second-lowest monthly total since HomeData began compiling com·pile tr.v. com·piled, com·pil·ing, com·piles 1. To gather into a single book. 2. To put together or compose from materials gathered from several sources: Los Angeles County data in January 2004. Only the 3,661 homes sold in February--one of the slowest months for sales--was lower. Similar carnage took place in the condo market with year-over-year sales plummeting 40 percent to 1,168 units. Sales were off 27 percent from July's 1,601 units. "These numbers are the first to show the beginning of the impact of the credit crunch that materialized in the last couple months," said Robert Kleinhenz, deputy chief economist The Chief Economist is a single position job class having primary responsibility for the development, coordination, and production of economic and financial analysis. It is distinguished from the other economist positions by the broader scope of responsibility encompassing the with the California Association of Realtors. Yet, as has been the case throughout the housing downturn so far, median home prices managed to hold their own. August's median dropped slightly from its record July level to $579,000, though it was still 5 percent higher than year-earlier levels. Condo prices actually hit a new peak of $460,000, up from July's $450,000 and from $415,000 a year ago. Whether the drop in sales is the start of a bleak The bleak is a small pelagic fish of the Cyprinid family. Description The body of the bleak is elongated and flat. The head is pointed and the relatively small mouth is turned upwards. The anal fin is long and has 18 to 23 fin rays. The lateral line is complete. trend or is merely a statistical aberration tied to the abrupt onset of the credit crunch remains to be seen. "The size of the drop is unusual and bears close watching in the months ahead," said Delores Conway, director of the Casden Forecast at the USC An abbreviation for U.S. Code. Lusk Center for Real Estate. High-end slowdown For articles with similar titles, see Slow Down (disambiguation). A slowdown is an industrial action in which employees perform their duties but seek to reduce productivity or efficiency in their performance of these duties. The differing trajectories--home sales down but median prices up--has been due to a strong market for high-end homes with sale prices exceeding $2 million. But last month, even this market took a hit as borrowers had a much more difficult time obtaining so-called jumbo loans Jumbo Loan Any residential or commercial mortgage with a loan amount exceeding the guidelines of Fannie Mae and Freddie Mac. Notes: Rates tend to be slightly higher on jumbo loans because lenders generally have a higher risk. , or those exceeding $4 17,000. "Everything was great until about a month ago. Then, on one day--Thursday, Aug. 9--everything changed as lenders shot up rates on jumbo loans to 9 percent and further tightened guidelines guidelines, n.pl a set of standards, criteria, or specifications to be used or followed in the performance of certain tasks. ," said Syd Leibovitch, owner of Beverly Hills-based Rodeo rodeo (rō`dēō, rōdā`ō), public exhibition of the skill of cowboys in various activities. Events include riding broncos, riding steers, "bulldogging" steers, roping and tying steers and calves, the use of the lasso, and Realty realty n. a short form of "real estate." (See: real estate) REALTY. An abstract of real, as distinguished from personalty. Realty relates to lands and tenements, rents or other hereditaments. Vide Real Property. , which mostly deals in homes worth more than $2 million. "It became almost impossible to find a jumbo loan." For 10 days, Leibovitch said, sales of high- end homes came to a screeching halt. "We lost about a haft-dozen deals," he said. Finally, towards the end of the month; sales picked up a bit as alternative sources of financing--chiefly savings and loans savings and loan n. a banking and lending institution, chartered either by a state or the Federal government. Savings and loans only make loans secured by real property from deposits, upon which they pay interest slightly higher than that paid by most banks. and credit unions--began to step in. The mid-range market went through similar turmoil last month. "We had a dramatic slowdown in activity in August. When the credit crunch hit, people didn't know what to do and they just froze froze v. Past tense of freeze. froze Verb the past tense of freeze froze, frozen freeze . It was like the Sept. 11 aftermath all over again," said Gregory Holmes, associate manager with Culdwell Banker residential brokerage in Studio City. Holmes said that "shock to the system" washed out almost all the buyers with less than prime credit or those who were unable to come up with 20 percent down payments. However, he said there are still some buyers who do qualify for prime loans and can come with a $150,000 down payment on a $750,000 home. "They are just a little harder to fred now than a year or two ago when we had all those bidding frenzies." This relative scarcity Scarcity The basic economic problem which arises from people having unlimited wants while there are and always will be limited resources. Because of scarcity, various economic decisions must be made to allocate resources efficiently. of buyers has put the squeeze on sellers. Leibovitch said about two- thirds of his firm's clients with listings have pulled them and chosen to wait out the market instead of accepting a lower price. That has put a further damper damp·er n. 1. One that deadens, restrains, or depresses: Rain put a damper on our picnic plans. 2. An adjustable plate, as in the flue of a furnace or stove, for controlling the draft. on home sales and it may also help explain why the average length of time homes have stayed on the market has declined from a high of 68 days in the first quarter to 50 days in the second quarter. Normally, a lengthening lengthening (lengkˑ·the·ning), n the use of various massage or muscle energy techniques to relax and stretch muscle and connective tissue. of the figure would be more consistent with a collapse in sales. "Those people who can afford to wait are definitely taking their homes off the market," Kleinhenz said. He also pointed to the unsold homes inventory, which measures how long it would normally take to sell all homes on the market. Last month, the inventory stood at about 12 months, nearly 50 percent higher than the historical average of 8.3 months. However, the all-time high was 28 months back in early 1991. "Back then, people were moving out of the region in droves, mainly because they had lost their jobs. We had net out-migration. These people had to sell their homes, no matter how long it took. Today, it's a different story," Kleinhenz said. Home seller blues Some homeowners who have decided to move and are not getting sufficient offers on their homes have chosen to rent out their homes on a temporary basis until the market begins to recover, according to Harvey Mark, a Long Beach area Realtor with Coldwell Banker. Mark said the impact of August's credit crunch on his clientele was less severe than in other areas of the county. "There are fewer buyers and the ones who are out there are a little gun-shy because of all the bad press in recent weeks. But they are all eventually buying. They are jumping on competitively priced properties," he said. Mark's territory in the Belmont Shore area of Long Beach has fared comparatively better than the rest of that city or the rest of the county, with home sales only off 7 percent from August 2006 and the median home price up about 5 percent. It's quite a different story in lower-priced exurbs like the Antelope Valley This article is about the Los Angeles County region. For the census-designated place in Wyoming, see Antelope Valley-Crestview, Wyoming. The Antelope Valley or lower-income inner cities communities like Compton and Lennox. Besides the national credit crunch, these regions have been hit particularly hard by foreclosures stemming from the subprime lending  This article or section may deal primarily with the U.S. and may not present a worldwide view. crisis.
For example, the HomeData figures show that the four Palmdale ZIP codes experienced a whopping 70 percent decline in home sales last month from August 2006 levels. Prices were off 6 percent to almost 15 percent. In three Compton ZIP codes, volume was off 62 percent to 75 percent, with price declines reaching almost 14 percent. BY HOWARD FINE Howard Fine (November 28, 1958) is an American acting teacher, the founder of the Howard Fine Acting Studio in Hollywood, CA, and also a theatre director. Early Life Howard Fine was born on November 28, 1958 in Providence, Rhode Island. He is the youngest of 5 children. Staff Reporter
Home Sales Tumble
August home sales in L.A. County were
only haft those of a year earlier and about
one-third those of two years ago.
Aug.'04 11,094
Aug.'05 12,107
Aug.'06 8,246
Aug.'07 4,107
Source: HomeOata Corp.
Market Highlights
MOST EXPENSIVE HOMES
8/07 8/07 8/06
ZIP Home Median Median
Community Code Sales Price Price Change
L.A./Westwood 90024 10 $2,074 $2,637 -21.4%
Beverly Hills 90210 14 2,056 1,200 71.3%
Pacific Palisades 90272 25 1,749 1,678 4.2%
L.A./Bel-Air 90077 7 1,725 1,454 18.6%
L.A./Windsor Sq. 90020 5 1,665 3,702 -55.0%
Manhattan Beach 90266 37 1,608 1,775 -9.4%
L.A./Brentwood 90049 12 1,506 1,630 -7.6%
Santa Monica 90403 3 1,500 1,428 5.0%
Santa Monica 90405 6 1,488 1,160 28.3%
L.A./W.Hollywood 90069 9 1,485 1,630 -8.9%
HOME PRICE LOSSES
8/07 8/07 8/06
ZIP Home Median Median
Community Code Sales Price Price Change
Malibu 90265 4 $556 $1,505 -63.1%
L.A./Windsor Sq. 90020 5 1,665 3,702 -55.0%
Long Beach 90802 5 420 625 -32.8%
Sherman Oaks 91403 15 789 1,140 -30.8%
Signal Hill 90755 4 488 692 -29.5%
West Covina 91791 17 500 696 -28.2%
Sierra Madre 91024 7 800 1,078 -25.8%
Sherman Oaks 91423 28 880 1,125 -21.8%
Whittier 90602 7 470 600 -21.7%
Whittier 90601 11 490 624 -21.5%
MOST EXPENSIVE CONDOS
8/07 8/07 8/06
ZIP Condo Median Median
Community Code Sales Price Price Change
Marina del Rey 90292 16 $1,038 $747 39.0%
Santa Monica 90403 13 890 788 12.9%
L.A./W.Hollywood 90069 23 860 593 45.0%
Beverly Hills 90211 3 840 748 12.3%
L.A./Hancock Park 90004 6 809 665 21.7%
Rancho P.V. 90275 7 758 475 59.6%
Pasadena 91105 13 714 630 13.3%
L.A./Playa Vista 90094 11 696 791 -12.0%
L.A./Brentwood 90049 14 695 675 3.0%
L.A./West L.A. 90025 34 688 715 -3.8%
CONDO PRICE LOSSES
8/07 8/07 8/06
ZIP Condo Median Median
Community Code Sales Price Price Change
L.B.-Belmont Shore 90803 5 $335 $595 -43.7%
L.A./W.Hollywood 90038 3 568 999 -43.1%
Monterey Park 91754 3 283 486 -41.8%
Lancaster 93536 4 200 324 -38.3%
Hermosa Beach 90254 3 505 790 -36.1%
Santa Monica 90405 6 527 822 -35.9%
N. Hollywood 91602 12 393 582 -32.5%
S. Pasadena 91030 7 460 650 -29.2%
L.A./Koreatown 90005 7 455 629 -27.7%
San Gabriel 91776 6 410 560 -26.8%
Sale price in thousands
Source: HomeData Corp., www.homedata.com
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