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# Prepping for the year ahead in housing
- URL: https://www.smdp.com/prepping-for-the-year-ahead-in-housing/
- Published: 2007-01-03T16:00:00.000Z
- Updated: 2026-10-24T22:57:20.000Z
- Author: Guest Author
- Tags: Opinion, Santa Monica, #archive-import

*By Jodi summers can’t find a daily press newstand in your area? We’ll try to get one to you!*

IN 2006, THE SOUTHLAND — SAN DIEGO, Los Angeles, Orange, Riverside, San Bernardino and Ventura counties — relaxed after the real estate run-up between 2000 and 2005, in which home values in many communities doubled and then some. Last year, the best places to invest were San Bernardino and Riverside, which still saw nice appreciation.

The median price of all types of homes sold in the six-county region was in the neighborhood of $487,000, up 1.7 percent from 2005, reports research firm DataQuick Information Systems. It’s the slowest rate of growth since February 1997.

“Obviously, there’s a correction going on, but it’s not going to collapse,” said Delores Conway, director of the Casden Real Estate Economics Forecast at USC. “Even with prices flattening, it doesn’t mean that we’re in a serious housing downturn.”

In Los Angeles County, reports DataQuick, median home prices rose 2.6 percent to $510,000 as sales fell 18.9 percent. Kudos go to San Bernardino, the county saw a median price rise of 8.6 percent to a record $380,000, while sales declined 26.7 percent. Nice growth was also had in Riverside County, where the median price rose 5.2 percent, to a record high of $426,000, but sales slumped 35.7 percent from a year ago. Ownership has been painful in San Diego County, where real estate is losing value. By year’s end, the median price fell 6.9 percent, to $482,000, as sales fell 24 percent. Ventura County was the biggest loser, with housing prices falling 8.2 percent, to $562,000, with sales sliding 30.8 percent. Orange County property saw no appreciation — the median residential property price of $616,000 is the same as 2005\. Sales dipped 29.3 percent.

Remove the now lackluster housing sector from the gross domestic product equation, and the GDP actually grew 3.3 percent in the second and third quarters of 2006 — close to the 3.4 percent rate achieved in the prior four quarters, observes the National Association of Manufacturers’ chief economist, David Heuther.

Foreclosures were at historic lows, and as you’d expect, they are now on the rise. RealtyTrac Inc., a company that monitors foreclosure activity, reports that the number of Notices of Default more than doubled to 18,516 — up from 7,080 in the third quarter of 2005.

“Historically, about 60 percent of those properties won’t get as far as the foreclosure auction,” said Rick Sharga, the vice president of marketing for RealtyTrac Inc.

The Casden Real Estate Economics Forecast and other experts note that the deceleration is a prerequisite for the housing market to reestablish its footing after an extraordinary period of growth.

The National Assn. of Realtors reported the largest single-family home-price gains in 2006 were in the Salem, Ore., area, where the third-quarter median price of $228,000 was 24.7 percent higher than the third quarter of 2005\. Next was Elmira, N.Y., where a median home price of $93,000 saw a price boost of 21.4 percent from the third quarter of 2005\. Going forward, in 2007, it is believed that real estate prices will go: “Not up, not down — ‘flat’ is the operative word for prices,” notes Inman News. “2006 was the year for adjustment, and adjust they did: they stopped rising as fast as the price of oil. Without easy money, without ridiculous hype and without speculators, 2007 will see further erosion of home prices.”

Housing will lose its sex appeal. TV shows on home improvements, weird realtors and house-flipping will be canceled.

The economy will grow at 2.9 percent in 2007 and 2.8 percent in 2008, the National Association of Manufacturers forecasts, up from 2.1 percent in 2006.

Heuther notes that residential housing prices will “continue to be a drag on the economy”in the first half of 2007, but solid growth in investment and trade will help the economy grow at a faster rate next year than in 2006\. Nationally, housing prices fell at a 9.2 percent annual rate in the fourth quarter 2006.

Looking forward, residential investment is expected to decline by 2.8 percent in the first quarter and 2.5 percent in the second quarter, before beginning to recover in the fourth quarter of 2007.

Jodi Summers is Director of the Investment Division at Boardwalk Realty. She or (310) 309-4219\. Visit her Web sites at www.SoCalInvestmentRealEstate.com or www.santamonicalandmarks.com.

*Originally published in the Santa Monica Daily Press print edition on January 3, 2007.* [Read the original PDF.](https://s3.us-east-1.amazonaws.com/smdp%5Fbackissues/010307.pdf?ref=smdp.com)