The national housing market is continuing to soften as new home sales dropped 10.5 percent while home prices fell for the fourth straight month to $230,400, reports The San Diego-Union Tribune. The decline, which was most severe in the West, is the largest nine years.
At the same time, new homes for sale surged to a record 548,000 units, reports The New York Times. The housing market slowdown has been orchestrated by the Federal Reserve Board, which is expected to raise rates again this week.
While San Diego’s market is slowing, something different is happening in the Los Angeles area, reports the Los Angeles Times. New home sales rose by 9.5 percent during the same time frame.
Amazingly, home inventory remains much smaller in Southern California than elsewhere. That’s because fewer new homes have been built in the Los Angeles area than the rest of the nation.
Still, demand overall seems to be cooling in the Los Angeles area, which has seen an 80 percent increase of unsold homes. That may change as pent-up demand kicks in this spring.
A few other markets also beat out the national trend. Tucson saw a 20.6 percent increase in home sales, reports The Arizona Daily Star. And while sales dropped in Phoenix’s West Valley, median prices continued to rise, reports The Arizona Republic. The Midwest saw gains in sales of 5.2 percent, reports The Chicago Tribune.
But the overall trend is clear: the bubble is starting to fizzle.