Tight housing market softens California sales
Prices rising as number of available homes shrinks
A continued shortage of available homes for sale lowered California home sales in September, while the median price reached the highest level in more than four years.
LeFrancis Arnold, president of the California Association of Realtors, said sales in the inland and coastal markets continue to move in different directions.
Low inventory -- especially in distressed areas -- is dampening sales activity, he said. In many of these areas, there is a one- to two-month supply of REO homes on the market.
"The Inland Empire and the Central Valley have experienced double-digit sales declines compared with last year," Arnold said. "Meanwhile, sales were higher in San Diego and most Bay Area counties, where the economies appear to be growing faster than the rest of the state."
Closed escrow sales of existing, single-family detached homes in California totaled a seasonally adjusted annualized rate of 484,240 units, according to information collected by CAR from more than 90 local Realtor associations and MLSs statewide. Sales in September were down 5.2% from a revised 510,910 in August and down 1.2% from a revised 490,280 in September 2011.
The statewide sales figure represents what would be the total number of homes sold during 2012 if sales maintained the September pace throughout the year. It is adjusted to account for seasonal factors that typically influence home sales.
The statewide median price of an existing, single-family detached home inched up 0.3% from August's $343,820 median price to $345,000 in September. The September figure was up 19.5% from a revised $288,700 recorded in September 2011, marking the seventh consecutive month of both month-to-month and year-to-year price increases.
September's median price was the highest since August 2008, when the median price was $352,730. The year-to-year increase was the largest since May 2010.
"For the state, at 3.7 months of supply, unsold inventory is still less than half what it would be in a normal market," said CAR Vice President and Chief Economist Leslie Appleton-Young.
"As a result of the constrained supply at the moderate and lower end of the market, sales of homes priced under $200,000 dropped nearly 28%, and homes priced $200,000-$300,000 fell more than 15% in September," she said.
"By contrast, in the upper price range, where inventory isn't as much of an issue, sales of homes priced $400,000-$500,000 rose more than 14%, and those priced above $500,000 increased more than 15%," Appleton-Young added.
Other key facts of CAR's September 2012 resale housing report include:
* California's housing inventory eased slightly in September, with the Unsold Inventory Index for existing, single-family detached homes edging up to 3.7 months, up from a revised 3.2 months in August and 5.3 months in September 2011. The index indicates the number of months needed to sell the supply of homes on the market at the current sales rate. A six- to seven-month supply is considered normal.
* Interest rates dipped in September after rising slightly in August. Thirty-year fixed-mortgage interest rates averaged 3.47% during September 2012, down from 3.60% in August, and down from 4.11% in September 2011, according to Freddie Mac. Adjustable-mortgage interest rates also edged down in September, averaging 2.60%, down from 2.67% in August and down from 2.84% in September 2011.
* Homes sold faster in September, with the median number of days it took to sell a single-family home falling to 39.3 days in September 2012 from 41.1 days in August and down from a revised 54.2 days for the same period a year ago.