The Los Angeles Daily News said Friday that based on a California Association of Realtors report, the real estate market in California fell a record amount because of the ongoing credit crunch.
The report found that when comparing the median price of a home throughout California in 2007 to 2006, the cost fell from $554,500 to $488,640.
The association's deputy chief economist, Robert Kleinhenz, said the median price decline was likely due to a lack of jumbo loans being distributed. He said the impact of the lack of loans for homes costing more than $417,000 and the related credit crunch could soon become limited.
Kleinhenz told the newspaper that once the state's credit issue is resolved, the median price of a California home could reach more than $500,000.