Are home prices really up 12 percent in Orange County CA???

The OC Register today stated that home prices are up 12%.  That sounds so great , but is that really accurate?

First of all, the price they are quoting is the Median home price.  That means that 50% of the houses closed for more than $432,000 and 50% sold for less.  In reality, that means that homes under $500,000 saw bigger gains than those over that amount.

Here are some March statistics for North Orange County Cities from the article:

City Zipcode Price Change from 2009 # of Homes Sold March 2010
Brea 92821 -17% 34
Brea 92823 +6.7% 5
Fullerton 92831 +15.6% 28
Fullerton 92832 +6.8% 14
Fullerton 92833 +21.2% 45
Fullerton 92835 -27.6% 23
Placentia 92870 +29.9% 49
Yorba Linda 92886 +3.5% 45
Yorba Linda 92887 -16.6% 19

I don’t believe that these numbers accurately reflect what is really happening in the market.  Using these numbers is like using a microscope to read a map; you don’t see the big picture. It’s also taking a snap shot of only four weeks last year versus the same four weeks this year.  Next month the numbers will be different! I suggest they look at the price per square foot to calculate their data.

Is it true that the market is improving? Yes, we are seeing sign of that.  Is it true that the home prices are going up? Yes, if you are referring to homes under $500,000.  No, if your home is worth more than $750,000.  I’ve talked to many home owners with homes over $1M and they aren’t so optimistic.

Do you think the market is improving?  Is your home worth more today than last year?  I’d love to hear from you. Please leave a comment.

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