Although slightly few homes sold in April 2012 over the previous month, record low interest rates and an increase in housing affordability contributed to a more than 5 percent rise in home prices. In April, the median price of a single-family home in Los Angeles County was $289,800 according to the California Association of Realtors (CAR). Compared to the March, where the L.A. County median was $272,920 this is an increase of 5.1 percent. In April 2011, the median price was $290,600, so prices countywide remain 1.3 percent under a year ago

Median Prices Rise in LA Metro

In the metropolitan area overall, however, the trend is slightly higher over 2011. The April 2012 median price was $289,700 and the March median was $276,270, so a difference of 4.9 percent. Over the past year, however, the shift was more dramatic. With an April 2011 median price of $277,300, the April 2012 prices show a 4.5% shift above a year ago. Statewide, the numbers are even better: The April 2012 single-family median home price was $308,050, up 5.7 percent over March ($291,330) and up 4.7percent over one year ago ($294,140)

Orange County Prices Increase

The median home price in Orange County was up 5.9? percent ($513,950 in April, over $485,300 in March) but compared to April 2011, it was down 3.1 percent ($530,140). In April 2012, ?more homes sold than in March by 1.4 percent, and by 19.2 percent over April of the previous year

According to CAR Vice President and Chief Economist Leslie Appleton-Young, April is the second straight month where the median price increased overall for the State. Appleton-Young attributes the numbers to a significant increase in sales of property above $500,000 (11 percent increase) versus homes below $500,000 (just 2.1 percent)

Three major factors behind LA price increase trends

  • The unsold inventory is low

  • The interest rates are low

  • Homes are on the market for shorter periods

The inventory index typically measures in months, that is, the number of months it would take to sell the inventory at current prices, with a seven-month period considered normal. At present, the inventory index is 4.2 months

According to Freddie Mac, in April, 30-year fixed-mortgage interest rates averaged just 3.91 percent. Last year’s rate was 4.84 percent. Compared with April 2011’s 3.20 percent, adjustable-mortgage interest rates averaged 2.78 percent in April 2012

Lastly, compared to 53 days a year ago, the number of days it is taking a single-family home to sell in 2012 is just over 49 days.