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<\/p>\nSouthern California homes are so unaffordable that sales activity has crashed to a pace even slower than the real estate-wrecking Great Recession.<\/p>\n
The homebuying data firm Attom just revised its sales statistics dating back to 2005, using new methods to sort out what, from public records, is a true home sale. These totals include closed transactions for houses and condos, both existing and newly built.<\/p>\n
My trusty spreadsheet analyzed the newly retooled Southern California numbers through July 2026. Sales are still scraping the bottom, and the few buyers who close a purchase are paying near-record high prices.<\/p>\n
So, how sluggish are sales across the six counties, based on closed transactions in the 12 months ended in July?<\/p>\n
\u2013 33% slower than the average homebuying pace seen since 2005.<\/p>\n
\u2013 It\u2019s the second-slowest pace in that period. The slowest was May 2026.<\/p>\n
\u2013 Almost as stunningly: July was 3% slower than the worst days of the late 2000s\u2019 real estate crash.<\/p>\n
Southern California\u2019s latest sales crash conditions have endured for three years. Contemplate the 25 slowest-selling individual months in the past 21 years.<\/p>\n
Seven occurred as global financial markets collapsed in 2007-08. May 2020 was another, during pandemic lockdowns.<\/p>\n
And 17 have happened since 2023.<\/p>\n
It\u2019s no secret that Southern California homes have been financially out of reach for most buyers for years.<\/p>\n
More recently, a shaky local economy has weakened most house hunters\u2019 confidence to overpay, especially when renting seems more budget-friendly for many households.<\/p>\n
The price is wrong<\/p>\n
Why are buyers staying away? The answer is simple.<\/p>\n
July\u2019s median price hit $815,000, Southern California\u2019s fourth-highest ever and just 2% below the all-time record.<\/p>\n
High prices don\u2019t prove a resilient market, no matter what the industry gurus say. They\u2019re a major problem, and wannabe sellers hopefully know it.<\/p>\n
<\/p>\n
Consider how few households could afford to buy this past spring in the six local counties, according to math from the California Association of Realtors: 15% in Orange, 17% in Los Angeles and San Diego, 19% in Ventura, 28% in Riverside, and 34% in San Bernardino.<\/p>\n
The rare bright spot for buyers is that price gains have cooled. Since 2023, Southern California prices have risen just 2% a year, compared with 7% a year in the decade before.<\/p>\n
But slower appreciation can also spook aspiring buyers. The prospect of big future gains often motivates people to buy in the first place.<\/p>\n
The monthly headache<\/p>\n
Let\u2019s get to what buyers really care about: the monthly payment.<\/p>\n
Southern California\u2019s cost burden, estimated using current mortgage rates, median prices, property taxes, home insurance, and mortgage insurance, is $6,883 per month. That payment has doubled in five years.<\/p>\n
Yes, the Federal Reserve ending its cheap-money policy in 2022 is among the culprits. But nobody complained when the Fed pushed mortgage rates to record lows over the previous three years.<\/p>\n
Plus, don\u2019t forget the $81,000 a Southern California house hunter needed in cash for the 10% down payment assumed in this payment calculation.<\/p>\n
These steep homebuying expenses feel more painful when the alternative is renting, even if ownership has its perks.<\/p>\n
A typical Southern California renter, using Zillow estimates for apartment and house rental costs, paid about $2,860 per month in July. That\u2019s 58% less than the estimated house payment.<\/p>\n
By the way, the average 30-year fixed-rate mortgage in July was 6.5%. It was 7.3% in mid-October.<\/p>\n
Do you think such a cost jump, which cut a house hunter\u2019s buying power by 8%, improved homebuying conditions?<\/p>\n
Jonathan Lansner is the business columnist for the Southern California News Group. He can be reached at jlansner@scng.com<\/a><\/p>\n