Sales of existing, single-family detached homes in California totaled a seasonally adjusted annualized rate of 406,800 units in April, down 2.6% from a revised pace of 417,580 in March and 5.4% off the pace of April, 2015, the California Association of Realtors reported Monday. It was the second worst start to a spring home-buying season since the housing recovery began in 2009.
The Realtor group attributed the drop to an imbalance between supply and demand and a 5.3% increase in the median home price to $509,100 from March, 5.1% higher than the same month in 2015. April marked the first time in nine years that the median price has risen above the $500,000 level but remains below the pre-recession peak of $594,530 reached in May 2007.
"Thin housing supplies were the driving force behind April's sales drop with the most inventory constrained markets feeling the largest declines," said C.A.R. Vice President and Chief Economist Leslie Appleton-Young. "In the San Francisco Bay Area, sales were down in eight of the region's nine counties, with only Napa – which had a five-month supply of homes for sale – posting a modest 1 percent gain. As home buyers continue to move inland to find affordable housing, inventory will eventually be depleted, putting upward pressure on home prices."
"The statewide median home price rising above $500,000 for the first time in nine years will undoubtedly exacerbate housing affordability for California home buyers," said C.A.R. President Pat "Ziggy" Zicarelli. "As home prices continue their upward trend, especially in high-cost, major metropolitan regions, home buyers are looking to maximize their housing dollars by moving to even further outlying regions. For example, Bay Area buyers who were previously seeking homes in areas adjacent to San Francisco, such as Solano and Sonoma counties, now are looking even further in Sacramento, Stanislaus, and San Joaquin counties, as Bay Area adjacent counties become less affordable."
Other key metrics from C.A.R.'s April 2016 resale housing report include:
- C.A.R.'s Unsold Inventory Index, which indicates the number of months needed to sell the supply of homes on the market at the current sales rate, slipped to 3.5 months in April from 3.6 months in March. The index stood at 3.4 months in April 2015. The negligible year-over-year improvement was driven entirely by the reduction in home sales as listings fell even further from their 2015 levels. The long-run average home supply is 6.1 months. Even with the minimal annual increase, inventory levels are running at roughly 60% of normal.
- The median number of days it took to sell a single-family home fell in April to 27.7 days, compared with 29.9 days in March and 28.8 days in April 2015.
- According to C.A.R.'s sales-to-list price ratio, tight inventories also appear to be driving final sold prices closer to listing prices, with sales prices rising to 99.3% of listing prices statewide in April from 98.8% in March.
- The average price per square foot for an existing, single-family home statewide was $244 in April 2016, up from $227 in March and $234 in April 2015.
- San Mateo had the highest price per square foot in April at $832/sq. ft., followed by San Francisco ($829/sq. ft.), and Santa Clara ($635/sq. ft.). The counties with the lowest price per square foot in April include Siskiyou ($109/sq. ft.), Madera ($124/sq. ft.), Tulare ($125/sq. ft.), and Kings ($125/sq. ft.).
- Mortgage rates dipped slightly in April, with the 30-year, fixed-mortgage interest rate averaging 3.61 percent, compared with 3.69 percent in March and 3.67 percent in April 2015, according to Freddie Mac. Adjustable-mortgage interest rates slipped, averaging 2.83 percent in April, down from 2.9 percent in March and 2.73 percent in April 2015.