Pasadena property values plummet in June

A Pasadena realtor/blogger issued a report on his blog that shows that Pasadena median home price values dropped 7.9 percent in June.

As we reported last week, in the last year Pasadena has still managed to greatly increase its property tax. So is this the first sign of serious weakness in Pasadena real estate?

The data from the realtor's blog (which he gathered from a real estate data site that requires a realtor's license/subscription fee to access) indicates that the median home price dropped from $790,000 last June to $700,000 this June, but that the median home price was still at $760,000 in May. Though I haven't consulted any other real estate sources on his numbers, I would think that it would be more in this guy's interest to present the appearance of a strong market rather than a weak one.

The realtor, Doug Willis, also points out that real estate markets usually heat up in summer, so having that much of a one-month drop sounds pretty serious.

As far how it fits in with the County Assessor's report that shows the property tax for the last year up- this last month would not have figured into that report. Also, the assessor's office includes commercial real estate in their figures. If this last month is the beginning of a new trend, next year's report may not be so kind to Pasadena.

Still, considering how few of us can afford to buy a $700,000 house, I'm not inclined to root hard for the price to go back up.

UPDATE: One reader comments on the confusion caused by our reports that Pasadena has increased tax revenue in the middle of a foreclosure crisis. It is confusing, so I thought I would post the comment, and my response to it up here in the main entry.

Truly Confused Reader said:
Very surprised to read this when only a few days ago your newspaper had a story on housing prices in San Gabriel Valley actually increasing in value.... No wonder people don't believe in newspapers. Responsible reporting please! The housing market is plummeting, banks are failing and the Star News says housing values are up! Come on! Yours truly,

Dan said:
Truly Confused: I believe the main difference, as I mentioned in the blog, is that the commercial real estate still is doing very well. The other reason that the assessed property values managed to go up is the way the county assesses them- if you don't sell or improve your house for many years, they don't reassess. So if you suddenly sell your house for $450,000, even if it would have gone for $600,000 two years ago, the county might have it assessed at $250,000 if that is the price you paid for it 15 years ago. Essentially, because of Prop 13 (which limits the percentage the county can increase property taxes annually) they leave a lot of property tax on the table when property values skyrocket, but it stops them from losing money when the values come back down. Hope that leaves you less confused.