It’s been cool at the beach this summer. I’m not talking weather.

No matter how I slice the housing data, a higher price tag often means slower sales. July’s CoreLogic data are just another example – and it was the busiest July for closed deals in a decade!

To get deeper into the data, I built a new measuring tool, which I’ll call “MOCHA” – the “Measure of Orange County Housing Acceleration.” MOCHA may provide more clues about what’s up and what’s down at the neighborhood level. It’s relatively simple math that uses CoreLogic data to score sales and price momentum in local ZIP codes.

Here’s how my trusty spreadsheet created a MOCHA ranking. First, I pruned from our survey the 10 percent of ZIPs with the least selling activity. This eliminated eight communities with limited numbers of homes in play, leaving 75 ZIPs to compare.

Next, I ranked the ZIPs both by year-over-year sales percentage growth and year-over-year price change. A MOCHA ranking was derived from the average of the sales and price rankings. ZIPs with high average rankings are the hottest by MOCHA’s definition; low rankings are the coolest.

When I looked at the rankings, a noteworthy trend popped out: The top-performing ZIPs had cheaper homes.

The average of the median prices for the top 25 ZIPs as ranked by MOCHA was $648,612 compared with $730,980 for the 25 worst performing ZIPs.

It seems that price matters, at least recently.

You can see that trend in the July MOCHA results, which show that the most sluggish housing markets are in neighborhoods by the sea, while the hottest are in inland communities:

• The weakest ZIP in July was Newport Coast 92657, with a median selling price of $1.62 million. It had a decline in its median selling price of 34 percent in a year, the county’s worst. Sales were down 34 percent, next to worst.

• Second weakest was San Clemente 92672, which had a median selling price of $645,000. It had a price drop of 10 percent in a year, the ninth worst. Sales were down 20 percent, fourth worst.

• Next came Laguna Beach 92651 – median selling price of $1.5 million. Its price drop of 15 percent was the fifth worst. Sales were down 7 percent, the 13th worst.

• Fourth from the bottom was Newport Beach 92663, with a median selling price of $1.36 million. It had a price drop of 19 percent, the third worst. Sales were off 6 percent, 15th worst.

• And not near the ocean, Foothill Ranch 92610 – with a median selling price of $520,500 – had the fifth worst score. It had a price drop of 18 percent in the year, the fourth worst. Sales were flat.

As for the hot markets:

• Top-ranked in my MOCHA index was Irvine 92602, with a median selling price of $936,500 in July. True, that’s not cheap, but the area is filled with pricey new home developments. This ZIP had a 25 percent year-over-year gain in its median selling price, the fifth best in Orange County. Sales were up 126 percent in a year, third best.

• Next came Irvine 92603, another popular spot for new housing, with a median selling price of $1.29 million. That’s up 35 percent in a year, the second best. Sales were up 71 percent, eighth best.

• Santa Ana 92701 ranked third, with a decidedly affordable median selling price of $340,000. Its 58 percent price gain was the county’s best. Sales were up 60 percent, 11th best.

• Also relatively cheap was No. 4 Stanton 90680 – with a median selling price of $402,500. It had a price gain of 14 percent, the 10th best. Sales were up 68 percent, ninth best.

• Ranking fifth was Mission Viejo 92691, which had a median selling price of $608,500. It had a price gain of 10 percent, the 21st best. Sales were up 82 percent, fifth best.

To be sure, MOCHA is not a perfect metric. It is perhaps best viewed as a snapshot of where buyers are actively shopping – or not.

For one thing, ZIP data represents geography, and the size of the housing market and demographics within each ZIP can vary widely. New housing communities can change a community’s profile, too.

Plus, this is based on just one month of data vs. another month – a short period that can be distorted by various economic and real estate factors.

Still, MOCHA’s results strongly hint at a market trend we’ve noticed in other studies: It’s been a challenging year for higher-priced housing. For example, ponder these other noteworthy trends:

• In the nine Orange County ZIP codes with median selling prices above $1 million, sales totaled 226 homes in July, down 4.2 percent compared with a year ago.

• In the 27 priciest ZIPs – median prices of $710,000 or higher – sales in July were up 12.3 percent compared with a year ago. While that’s a healthy gain, it trails July’s overall market sales, which rose 15.5 percent from a year ago.

• Builders sold 228 new homes in July, down 34.1 percent from a year ago. New homes are often among the market’s priciest options. July’s median price for these residences was $811,250 – up 2.6 percent from a year ago.

Remember that 3,692 Orange County residences sold last month, the busiest July in a decade. But it was by no means a universal homebuying binge: Sales rose in just 58 of 83 Orange County ZIPs.

So why the homebuying sluggishness in several high-end niches?

First, there aren’t affordable homes in those markets, so the upper-crust communities lack the quick-to-sell properties.

Second, overseas borrowers, who like pricier housing, may be struggling with weak foreign currencies and economies, making Orange County homes more of a financial challenge.

Plus, it appears that many sellers of Orange County’s priciest homes have misjudged the market and set asking prices too high.

http://www.ocregister.com/lansner/price-678986-percent-sales.html