Southland home prices jump 11.4%

Home prices in Southern California jumped 11.4% in January — the largest year-over-year gain in 44 months as the region’s already sizzling market got even hotter.

The double-digit rise in the median price put it at $507,000, which was lower than December’s peak of $509,500 when the six-county region surpassed bubbleera highs of $505,000 in 2007, according to a report Tuesday by research firm CoreLogic.

But that one-month reduction in the median price isn’t expected to spark a trend.

Home prices have been rising each month on a yearover-year basis for more than five years. In addition to an improving economy, low mortgage rates have lifted the market and enabled borrowers to pay more for a house, as long as they can make a substantial down payment.

Adjusted for inflation, the region’s median is still nearly 13% below the 2007 peak.

Sales in Riverside and San Bernardino counties — the region’s most affordable areas — represented a larger share of January activity than a year earlier, which put downward pressure on the regional median price.

“Affordability drives everything in the Inland Empire,” said analyst Patrick Duffy, principal of MetroIntelligence Real Estate Advisors.

And although mortgage rates remain historically low at about 4.5% for a 30-year fixed loan, they are ticking up, and the increases may be impelling some buyers to sign on the dotted line, Duffy said.

New-home sales in the region were up 26% year over year, but overall sales, including resale homes and condominiums, were down 1.5%.

Absentee buyers, mostly investors and vacation-home buyers, bought 24.5% of all homes sold in January, said CoreLogic analyst Andrew LePage. That was up from 23.1% in December.

December home prices continued their rise across the country over the last 12 months, according to the S&P CoreLogic Case-Shiller Indices.