Souther California Market Highlights from December 2014

• Foreclosure resales represented 5.0 percent of the resale market in December. That was down from a revised 5.5 percent in November 2014 and down from 5.8 percent in December 2013. In recent months the foreclosure resale rate has been the lowest since early 2007. In the current cycle, foreclosure resales hit a high of 56.7 percent in February 2009. Foreclosure resales are purchased homes that have been previously foreclosed upon in the prior 12 months. 
• Short sales made up an estimated 6.2 percent of resales in December, down from a revised 6.4 in November 2014 and down from 10.2 percent in December 2013. Short sales are transactions in which the sale price fell short of what was owed on the property.
• Absentee buyers – mostly investors – bought 23.4 percent of the homes sold in December. That was down from a revised 23.8 percent in November 2014 and down from 26.9 percent in December 2013. The December 2014 absentee level ties the October 2014 level as the lowest for any month since October 2010, when 22.1 percent of homes were sold to absentee buyers. The peak absentee share was 32.4 percent in January 2013, and the monthly average since 2000, when CoreLogic DataQuick absentee data began, is about 19 percent. Absentee buyers include those who purchase vacation homes or other properties that public property records suggest are not used as primary residences. 
• Cash buyers accounted for 23.8 percent of December home sales, down from a revised 24.3 percent in November 2014 and down from 28.8 percent in December 2013. The December 2014 cash level was the lowest for any month since January 2009, when 22.0 percent of homes were bought with cash. The peak was 36.9 percent in February 2013, and the monthly average since 1988 is 16.7 percent.
• Southern California home buyers committed a total of $4.43 billion of their own money in the form of down payments or all-cash purchases in December. That was up from a revised $3.47 billion in November 2014. The out-of-pocket total peaked in May 2013 at $5.41 billion.
• Jumbo loans, or mortgages above the old conforming limit of $417,000, accounted for 31.3 percent of purchase lending in December, up from a revised 30.5 percent in November 2014 and up from 28.5 percent in December 2013. The July/August 2014 level of 32.3 percent was the highest since the credit crunch struck in August 2007. Prior to August 2007, jumbo loans accounted for around 40 percent of the home-loan market. The jumbo level dropped to as low as 9.3 percent in January 2009.
• Adjustable-rate mortgages (ARMs) represented 12.1 percent of home purchase loans in December, up from 12.0 percent in November 2014 and down from 13.0 percent in December 2013. The ARM share dropped to as low as 1.9 percent of home purchase loans in May 2009. Since 2000, a monthly average of about 30 percent of purchase loans have been ARMs.
• All lenders combined provided a total of $6.19 billion in mortgage money to Southern California home buyers in December, up from a revised $4.88 billion in November 2014 and up from $5.40 billion in December 2013. 
• The typical monthly mortgage payment for Southern California home buyers in December was $1,558, down slightly from $1,560 in November 2014 and down from $1,594 in December 2013. Adjusted for inflation, the December 2014 typical payment was 35.6 percent below the typical payment in the spring of 1989, the peak of the prior real estate cycle. It was also 47.3 percent below the current cycle’s peak in July 2007.