As sales declined, home prices climbed in the region.
Southern California's median home price jumped 20 percent in December from a year ago, according to La Jolla-based DataQuick, driven by strong investment activity, a record number of cash buyers and a continued shift to mid- and high-end sales.
But industry professionals say the lower rate of sales in the Inland Empire was not so surprising.
"It does not surprise me that sales are down," said Michael Carney, who runs the Real Estate Research Council of Southern California and is a professor at Cal Poly Pomona. "There's clearly a supply constraint. Realtors will tell you they want more inventory. They're sure they could sell more houses if someone would just put them on the market."
This report, he says, shows the increase in San Bernardino and Riverside counties' home values is greater than the other four counties - Los Angeles, San Diego, Orange and Ventura - and those are the biggest of the six counties.
The Southern California average is heavily influenced by Riverside and San Bernardino counties, Carney said.
In San Bernardino County, the median price increased to $180,000 from $150,000 a year ago. The median made double- digit percentage gains in all six counties.
Riverside County's median price rose to $231,000 from $194,000, while in Los Angeles County, the median price increased to $323,000 from $270,000 a year earlier.
The median made double-digit percentage gains in all six counties studied by DataQuick.
"The question when the year started was, would the market find a (price) bottom? I think there are far fewer people worried now about prices falling and significantly more concerned about prices going up," said DataQuick analyst Andrew LePage.
"We've answered the question: Yeah, we found a bottom."
For all of Southern California, sales of new and previously owned houses and condominiums increased to 20,274 last month from 19,247 in December 2011.
Riverside and San Bernardino counties were the only ones with declining sales, DataQuick said.
"I wouldn't be too concerned about it," Carney said. "Likely in the next few months we'll see those sales come back up again. I have no doubt if you average activity in the past six months for all of those counties, (the six counties) will come out about the same."
For the full year, sales increased 10 percent to 235,119 properties from 214,362 in 2011.
"The housing market had more to offer in 2012 than many anticipated. A lot of markets ... started to see their first meaningful gains in nearly two years," DataQuick President John Walsh says in a statement.
Buyers were drawn back into the market by record or near record low mortgage rates and a brighter job outlook, he says.
"Last year should also be remembered as the year the move-up market awoke. If these upward trends hold, which requires a sustained economic recovery, we should eventually see more inventory hit the market," Walsh said.
Rising prices would also bring more sellers into the market.
Distressed properties continue to have a diminished role in the market.
In December, foreclosure resales accounted for 15 percent of the Southland sales, flat from November and down from 32 percent a year ago.
Last month's level was the lowest since foreclosure resales had 14 percent of the resale market in September 2007. In the current cycle, foreclosure resales hit a high of 57 percent in February 2009.
Short sales - transactions where the sale price fell short of what was owed on the property - made up an estimated 26 percent of resales last month. That was also flat from November and a year ago.
A separate report from the California Association of Realtors shows a similar trend. (The association calculates sales on an annualized rate and does not include transaction numbers.)
During December, sales of previously owned houses increased 1 percent to an annualized rate of 522,510 units, the Los Angeles-based group said.
Sales fell 15 percent in San Bernardino County and 9 percent in Riverside County. In Los Angeles County, sales increased 5 percent.
The association also showed prices increasing by double-digit percentages across Southern California from a year earlier.