The housing prices in Southern California are continuing to rise even as demand for the homes slows according to the recent numbers coming out today. With the end of the home flipping and the churn that was created, most assumed that housing prices would fall drastically. Add to that the removal of 100 percent financing and subprime loans, the recipe for disaster was written by many.

But the market refused to budge, sellers held their prices and they are being rewarded. Southern California saw housing prices rise again even has demand has slowed since last year. There are enough buyers that have held off to backfill the churners and low income buyers to keep the market moving forward.

Yet the median sales price in Southern California went up again in March, crossing the half-a-million-dollar mark, a real estate data service reported Thursday.

The median price paid for a home in Southern California last month was $505,000, up 4.6% from March 2006, according to La Jolla-based DataQuick Information Systems. The median is the point at which half the prices are higher and half are lower.

Sales volume dropped substantially, however, continuing a trend that began 18 months ago when the red-hot market first began to cool.

March sales totaled 21,856 new and resold homes in Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties. That was down 32.4% from March 2006, the sharpest year-over-year drop since September. It was the slowest March in a decade.

The falling sales numbers reflect the fact that some owners, now that their equity is rising only modestly, are declining to move up.

Entry-level buyers, meanwhile, are being squeezed out of the market. DataQuick noted that financing with adjustable-rate mortgages had fallen sharply. These loans, many with low introductory teaser rates, have become harder to get as lenders toughen their standards or go out of business because of rising defaults and foreclosures.

Home prices rise despite housing woes – Los Angeles Times.

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