California existing home sales ticked up in September on a year-over-year basis for the first time in seven months as a shortage of homes available for sale continues to hold back the market, the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) said Monday.
Closed escrow sales of existing, single-family detached homes in California totaled a seasonally adjusted annualized rate of 425,680 units in September, according to information collected by C.A.R. from more than 90 local REALTOR® associations and MLSs statewide. The statewide sales figure represents what would be the total number of homes sold during 2016 if sales maintained the September pace throughout the year. It is adjusted to account for seasonal factors that typically influence home sales.
The September figure was up 1.3% from the revised 420,360 level in August and up 0.8% compared with home sales in September 2015 of a revised 422,360. Home sales remained above the 400,000 pace for the sixth straight month, and the year-over-year increase was the first since January.
"While higher sales both on a monthly and an annual basis is a glimmer of good news, with most of the home-buying season behind us for 2016, it's not enough to tip the scales for an increase above 2015's sales pace," said C.A.R. President Pat "Ziggy" Zicarelli. "With listings continuing to decline and demand still strong, especially at the lower end of the market, affordability will remain a challenge for would-be buyers."
The statewide median price remained above the $500,000 mark for the sixth straight month, with minimal signs of cooling down outside of a few select markets. The median price of an existing, single-family detached California home was down 2.3% in September to $514,320 from $526,580 in August. September's median price increased 6.1% from the revised $484,670 recorded in September 2015. The median sales price is the point at which half of homes sold for more and half sold for less; it is influenced by the types of homes selling, as well as a general change in values. The monthly price decline is primarily due to seasonal factors.
"While demand remains strong for lower-priced homes, which are more inventory constrained, sales of homes at the higher-end have slowed significantly," said C.A.R. Vice President and Chief Economist Leslie Appleton-Young. "For example, sales of properties priced between $2 million and $3 million, which are the least inventory constrained, grew by high double-digits in 2014 and 2015, but the pace has slowed down to a negligible 0.2% increase through the first nine months of this year."
Other key points from C.A.R.'s September 2016 resale housing report include:
- Current home prices in the state are still 13.5% below their previous peak, though most parts of the San Francisco Bay Area have already reached new all-time highs.
- 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 inched up to 3.5 months in September from 3.4 months in August. The index stood at 3.6 months in September 2015.
- Statewide active listings continue to decline, falling 3.1% from August and 4.9% from a year ago. The year-over-year listings decline is the highest since January 2016.
- The median number of days it took to sell a single-family home was unchanged from August at 28.9 days but was down from 31.8 days in September 2015.
- C.A.R.'s sales-to-list price ratio* dipped slightly in September, with sales prices slightly decreasing to 98.6% of listing prices statewide in September from 98.9% in August and flat from September 2015.
- The average price per square foot** for an existing, single-family home statewide reached a post-recession high in September at $249, up from $246 in August and from $235 in September 2015.
- San Francisco County had the highest price per square foot in September at $852/sq. ft., followed by San Mateo ($759/sq. ft.), and Santa Clara ($612/sq. ft.). Counties with the lowest price per square foot in September include Tehama ($123/sq. ft.), Siskiyou ($126/sq. ft.), and Tulare and Kings both at $128/sq. ft.
- Mortgage rates are expected to remain low in the foreseeable future, though the Federal Reserve is expected to raise interest rates by year's end. Mortgage rates edged slightly higher in September, with the 30-year, fixed-mortgage interest rate averaging 3.46%, up from 3.44% in August but down from 3.89% in September 2015, according to Freddie Mac. The five-year, adjustable-rate mortgage interest rates also rose in September to an average of 2.81%, up from 2.75% in August but down from 2.92% in September 2015.