Home Prices Up 2.2% in November, TRW Study Says

The average home price in Orange County increased 2.2% in November, indicating that the local housing market is merely simmering after the roiling price increases of spring and summer.

The county’s average home price climbed to $213,414 in November, while the number of homes sold fell 9.3% to 4,523 units, according to statistics released Tuesday by TRW Inc.’s Real Estate Market Information Division in Orange.

Although the rate of appreciation has been moderating in recent months, November’s price is still 21% higher than the $176,455 average recorded in November, 1987.

Real estate analysts said the figures appeared normal for this time of year in Orange County, where rapidly escalating home prices made it one of the hottest markets in the nation.

Typical Decline

“About the only thing that may be significant is that the number of home sales is still so strong,” said John Karevoll, a TRW spokesman. “We expected even lower numbers. We’ve seen bigger declines in other areas of the country, like Florida, which also has a strong economy.”

Home sales typically decline in the fall, Karevoll said, so a 9.3% decrease from October to November was not unexpected. Last year, the October stock market crash added to the seasonal decline, dropping the number of units sold 17.7%, according to TRW figures.

“Come Thanksgiving Day, people start thinking about shopping for Christmas, not shopping for a home,” said Kenneth Agid, a housing consultant with the Marketing Department in Irvine.

Prices of Orange County homes rose to the highest in the country during the summer, but the market began to cool somewhat in the fall. The average price dipped 3.4% in October, the first decline in 8 months, according to TRW.

Strong Demand

“There’s been a cooling in interest in building subdivisions in the last 2 months, and fewer people are looking for homes,” Agid said. “The frenzy is certainly diminished. . . . We’re now in a more normal pattern.”