California Home Prices Continue Plunge

Home prices continue to fall in California, with median home prices plunging to 2004 levels in many of California’s most populous counties in February.  Southern California let the slide with an overall an overall drop of 17.9 percent compared to a year earlier.  So far this year, median prices have dropped in 15 major counties.

Home sales volume has also continued a sliding trend last month, with sales falling 39% from a year earlier in Los Angeles, Orange, Riverside, San Diego, Ventura and San Bernardino Counties.  The trend begain in September, with Southern California home sales dropping to new lows every month since September 2007. 

Even as prices have been falling dramatically, potential buyers are still holding out, as fears persist that the price bottom had not yet been hit.  To make matters worse, many potential buyers are now having trouble finding affordable financing as lenders hurt by mortgage defaults and foreclosures have cut back on the easy credit once available during the house boom of the early 2000s.