HOME COSTS, SALES PACE BOTH CLIMB REAL ESTATE REMAINS STRONG.

Byline: Brent Hopkins Staff Writer

California's housing market continued its hot streak in October with the median price increasing an annual 17.4 percent to $381,200 and sales rising 9.9 percent, trade groups said Tuesday.

Los Angeles County sales climbed 6.3 percent while its price appreciation rate outpaced the state's, as the median price jumped 21 percent to $326,750. Analysts and economists see no sign of weakness in the market, even though mortgage rates bottomed the week ending June 19.

Statewide, the median price - the point at which half the units sell for more and half for less - has seen double-digit annual percentage growth for 23 consecutive months.

``It's defying all our expectations, and continues to do so,'' said Leslie Appleton-Young, chief economist for the Los Angeles-based association.

Rising interest rates put some pressure on the market, driving sales in August and September, she said.

If sales proceeded at October's pace throughout the year, escrow would close on 636,690 previously-owned single-family homes. Last year's October pace would have resulted in 579,240 sales over 2002.

Inventory remained tight, too. The association's unsold inventory index, which measures the number of months needed to exhaust the current supply of homes, shrunk to 2.2 months, down from three months last October.

``The market's driven by the most mundane things: there's more buyers than sellers,'' said John Karevoll, an analyst with DataQuick Information Systems, a La Jolla-based real estate information service. ``Demand isn't driven by interest rates, it's driven by people graduating college, getting married, getting new jobs. As long as there are fewer houses on the market than there are buyers, we'll have a strong market.''

Malibu's median price of $1.03 million made it the state's second most expensive community, while La Canada-Flintridge, with a median price of $923,000, was the fifth priciest.

Prices gained ground throughout the region:

--In Ventura County, the median price rose 20.3 percent to $470,510, while sales rose an annual 7.4 percent.

--In the High Desert, including the Antelope Valley, the median price climbed 23.5 percent to $168,720, with sales rising 18.3 percent.

--For Riverside and San Bernardino, the median price of $238,820 was a rise of 30 percent, while sales numbers rose 9.2 percent.

Though analysts concur that the strong sales increases will continue, perhaps as far as next summer, appreciation rates may decline. Karevoll said that if interest rates, at an average 5.95 percent for a 30-year fixed mortgage in October, hold up, appreciation will drop to 12 to 15 percent annually. According to the report, adjustable mortgage interest rates averaged 3.74 percent in October.

``The rate of growth in home values will slow down in California,'' agreed Nima Nattagh, director of research for mortgage industry watcher FNC Inc. ``We're already seeing signs that appreciation's slowing down in the Bay Area, and you should see that in the rest of California in 2004.''

Brent Hopkins, [phone]

brent.hopkins(at)dailynews.com