Fourth Quarter 2018 Regional Glance For Southern California Real Estate
See how your region ended 2018 with our fourth quarter 2018 Southern California market recap.
The fourth quarter 2018 Southern California real estate market regional recap shines light on how the major markets finished out 2018.

Check Out How Your Region Fared in the Fourth Quarter 2018 Market Recap

Fourth quarter 2018 real estate data for Southern California closes the year out the same way it started – by showing markets that are very much in transition. With the release of fourth quarter 2018 data, we have assembled a summary of how some of our major markets are faring. Please keep in mind that the stats below take into account a variety of property types and are meant to paint a comprehensive picture of each market’s health. For the latest community/neighborhood data or to find out what your home is worth, contact one of our real estate professionals to discuss your options.

Coachella Valley Fourth Quarter 2018 Regional Glance

The Coachella Valley closed out the year with the same general trends that we have been monitoring along our coastal markets. Year-over-year, the number of homes changing hands in Q4 2018 dropped by 9%, and compared to third quarter of 2018 dropped 11.3%. This resulted in a slight dip in closed sales volume year-over-year (-0.1%) but a 5.4% dip compared to last quarter. Despite these decreases, the average closed sales price clocked in at $461,300, which is a 9.8% jump compared to the same time last year and a 6.7% increase over third quarter 2018. Inventory quarter-over-quarter is up by 25.4%, which is normal given the seasonality of the desert market. Year-over-year, however, inventory is down by 11.2%. Despite lower inventory, the sales pace (average days on market) is 79, which is 13.2% faster than the same time last year and 11.2% quicker than last quarter. Additionally, the listing discount (sold price versus list price) is 96.7%, which is roughly the same year-over-year (up by 0.1%) and quarter-over-quarter (down by 0.1%). Just as we saw with the average closed sales price, the average price per square foot came in at $232.30, a 7.7% increase year-over-year and a 5.4% jump from third quarter. Overall, the market sits at 1.6 months of inventory, which is the same as it was at the same time last year and a 45.5% jump from last quarter. As the main sales season moves into 2019, we will need to keep an eye on how shifting inventory levels impact other metrics, most notably home prices. However, with a quickening sales pace and current market conditions in other communities around Southern California (most notably on the coast) pricing some buyers out of their dream homes, the Coachella Valley market may be buoyed because of the value the region offers homebuyers.

Orange County Fourth Quarter 2018 Regional Glance

After months of showing a transition back toward a buyers’ market, Orange County’s fourth quarter 2018 numbers appear to show the strongest signs yet. Year-over-year, the number of sales dropped by 15.3%, and compared to third quarter, the total units exchanged dropped 20%. Additionally, the market sales volume saw big drops of 12.3% year-over-year and 22.3% quarter-over-quarter. The average closed sales price saw a slight increase of 3.5% year-over-year to $889,100, but year-over-year, this number accounts for a 2.9% drop. Finishing out the year riding the same trend, inventory was up 61.4% year-over-year, but down 20.8% compared to third quarter. This drop over the quarter is not as concerning given high sales season is typically third quarter each year. Further supporting the case of a shift to a buyers’ market, the sales pace (average days on market) went up to 45 days on average, a 9.8% jump from the same time last year and a 21.6% leap from third quarter 2018. Sales discount (sold price versus list price) came in at 96.8%, down by 0.8% compared to the same time last year and down by 0.9% compared to last quarter. The average price per square foot saw a 3.2% increase year-over-year, but dipped by 1.8% quarter over quarter. All in all, the months of inventory finished at 2.8, an 86.7% bump from fourth quarter last year, and the same as it was last quarter. Looking at a climbing inventory, slowing sales pace, and deeper discounts on the sales price, Orange County is well on its way back to being a buyers’ market. The cracks in these key stats show that many buyers perceive the market to be overvalued, which should lead to more realistic pricing and a dip in sale price. However, this softening of home prices will open up the buyer pool and allow more people to realistically afford a home in 2019.

San Diego Fourth Quarter 2018 Regional Glance

As was the case over the majority of 2018, the San Diego real estate market is undergoing the same broad trends as Orange County. The number of homes changing hands is down significantly year-over-year (down 15.2%), and even compared to last quarter (down 18.9%). Total sales volume as a result is down by 9% compared to the same period last year and down 19.1% compared to third quarter 2018. However, the average closed sale price, coming in at $704,200, is 7.3% higher than the same time last year and slightly down (0.2%) compared to last quarter. As with Orange County, inventory levels are up significantly over the same time last year, with a 51.6% jump. However, inventory is down 20.5% when looking at third quarter 2018, but this is largely due to a seasonality effect. Sales pace (average days on market) is up to 35 days, a 16.7% jump over last year and a 25% increase over last quarter. The listing discount (sold price versus list price) is getting a little deeper, coming in at 97%, which is a 0.6% drop compared to the same time last year (97.6%) and down almost a full percentage point from last quarter (97.9%). As we saw with the average sale price, average price per square foot finished at $389.10, a 5.9% increase from last year but a slight (0.5%) dip from last quarter. When accounting for inventory and sales pace, the months of inventory winds up at 2.5 months, a 78.6% leap from the same period last year but a dip of 3.8% from last quarter. Overall, San Diego is on a steady slide back toward a buyers’ market. A flood of inventory, deeper discounts on the list price, and drop in activity are proof positive that many buyers are practicing patience and waiting for the market to course correct in price. Those homes that are selling, although going for more than they did a year ago, are not selling as high as originally priced and taking longer to sell. With market dynamics shifting and additional competition for serious buyers starting to take hold, sellers need to become more realistic with their pricing expectations as we head into 2019 if they want to capitalize on a still solid market.

San Gabriel Valley Fourth Quarter 2018 Regional Glance

Wrapping up the year much the same way as it progressed throughout 2018, the San Gabriel Valley is also in the throes of a broad shift. The number of units trading hands dropped by 12.8% compared to fourth quarter last year and dipped 19.9% compared to third quarter. The result is a 9.1% decline in total sales volume compared to last year and a 19.4% drop from last quarter. However, the average closed sale price finished at $799,800, which is a 4.2% increase from last year and a slight (0.6%) bump from last quarter. Inventory is up by 39.1% from last year and down by 16.1% compared to third quarter, which (as is the case with the markets in San Diego and Orange County) has more to do with seasonality than anything. Additionally, sales pace is up to an average of 43 days on market to sell a home, 4.9% higher than the same time last year and 19.4% higher than last quarter. Those homes that are selling are doing so at a little more of a discount, coming in at 98.6% sold price versus list price. This figure is down by 0.4% compared to the same time last year and down 0.7% from last quarter. Echoing the increase in average sale price, average price per square foot finished at $409.40, a 5.1% jump from last year and a 1% drop from last quarter. Overall, there is a 1-month supply of inventory, which is a 66.7% increase from the same time last year and an 11.1% increase from last quarter. Although inventory levels are still minuscule, big increases in homes hitting the market combined with drops in activity, longer market time, and small cracks in listing discount indicate the San Gabriel Valley market is continuing its shift back toward a buyers’ market. As we have tracked over the last few months, this market is slightly behind the shifts we are seeing in San Diego and Orange County, but still ahead of the same broad trends in the Coachella Valley. As we head into 2019, we will continue to monitor how growing inventory levels and greater buyer patience affects pricing levels.

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