Closings of new homes in the Los Angeles, CA market sank year-over-year in June, a downhill move after a boost in May 2016. There was a 7.3% drop in new home closings from a year earlier. This followed a 20.1% hike year-over-year in May.
A total of 7,121 new homes were sold during the 12 months that ended in June, down from 7,176 for the year that ended in May.
New home closings accounted for 5.7% of overall housing closings. New home closings were 6.0% of overall closings last year. Following a year-over-year decline in May, closings of new and existing homes also declined year-over-year in June.
Pricing and Mortgage Trends
The average price of newly sold homes slid 1.7% year-over-year in June to $856,439 per unit. This decline follows a move from $891,654 per unit to $889,172 from May 2015 to May 2016.
There was a surge year-over-year in the average mortgage size on new homes in contrast to new home prices. The average mortgage size rose to $604,115 in June, marking a 4.3% gain compared with a year earlier. Average mortgage size jumped 4.1% in May 2016 from a year earlier.
Other Market Trends
As a percentage of new home closings, attached unit closings have risen from last year while single-family home closings have dropped. The share of new home closings belonging to attached units climbed from 35.7% of closings in June 2015 to 39.0% of closings in June 2016. At the same time, the share belonging to single-family homes declined to 61.0% of closings from 64.3% of closings.
The average unit size of newly sold homes gained 6.4% year-over-year to 2,624 square feet in June 2016. In May, the average size of new homes sold went from 2,602 square feet a year earlier to 2,270 square feet.
Foreclosures and real estate owned (REO) closings continued to decline from a year earlier in June, but did not appear to be dragging the market. Together, foreclosures plus REO closings accounted for 8.9% of existing home closings, down from 10.8% a year earlier. The percentage of existing home closings involving foreclosures sank to 3.4% in June from 4.8% a year earlier and REO closings moved from 5.9% of existing home closings in June 2015 to 5.4% in June 2016.