CA real estate: Median home price at $607,990 in July; 4th straight month above $600K
The lowest mortgage interest rates in nearly three years helped jump start California’s housing market to post the first year-over-year sales gain and highest sales level in 15 months, the California Association of Realtors (C.A.R.) said recently.
Closed escrow sales of existing, single-family detached homes in California totaled a seasonally adjusted annualized rate of 411,630 units in July, according to information collected by C.A.R. from more than 90 local Realtor associations and MLSs statewide.
The statewide annualized sales figure represents what would be the total number of homes sold during 2019 if sales maintained the July pace throughout the year. It is adjusted to account for seasonal factors that typically influence home sales.
July’s sales figure was up 5.6% from the 389,730 level in June and up 1.1% from home sales in July 2018 of 407,030.
“Mortgage rates that dipped to the lowest level in nearly three years have helped reduce monthly mortgage payments for the past five consecutive months, giving buyers more purchasing power,” said C.A.R. President Jared Martin. “The boost in demand gave the housing market its first yearly gain since April 2018.”
After setting record prices for the past three months straight, the median price pulled back from June’s $610,720 but still registered higher than the previous year. July’s median price was $607,990, down 0.4% from June and up 2.8% from $591,230 in July 2018, marking the fourth straight month that the median price remained above $600,000.
“While it’s encouraging that home sales crept higher in July, the market will continue to be challenged by an overarching affordability issue, especially in high cost areas such as the Bay Area, which requires a minimum annual income well into the six figures to purchase a home,” said C.A.R. Senior Vice President and Chief Economist Leslie Appleton-Young.
Other key points from C.A.R.’s July 2019 resale housing report include:
At the regional level, non-seasonally adjusted sales increased from a year ago in all major regions, except the San Francisco Bay Area, which experienced a 0.6% decline. The Central Valley recorded the largest gain at 5.2%, followed by the Central Coast region, which grew 5%. The Los Angeles Metro region posted a 4% increase, and sales in the Inland Empire improved by 2.4%.
In the San Francisco Bay Area, Alameda County recorded the largest drop in non-seasonally adjusted sales from a year ago at 10.5%, followed by Contra Costa County (-5%) and San Mateo County (-3%). On the other hand, Marin, San Francisco and Sonoma counties posted double-digit sales gains from a year ago. Sales in the three remaining counties grew in the single digits.
Non-seasonally adjusted sales rose in every county in Southern California, with Orange County rising the most at 6.7%, followed by San Bernardino (5%), Los Angeles County (4.7%), San Diego (3.4%), Ventura (2.1%) and Riverside (0.8%).
Median home prices at the regional level continued to inch up in Southern California and the Central Valley regions, while the Central Coast and Bay Area declined slightly from a year ago.
In the Southern California region, median home prices grew in every county, while most Bay Area region counties continued to experience price softening on a year-over-year basis.
Median prices improved from the prior year in all Central Valley region counties, except San Benito.
Active listings, which had been increasing year-over-year for the past 15 months, fell 2.1% from a year ago.
The decrease in active listings and an increase in home sales contributed to a year-over-year decline in unsold inventory for the first time in 15 months. The Unsold Inventory Index (UII), which is a ratio of inventory over sales, was 3.2 months in July, down from 3.4 months in June and down from 3.3 months in July 2018. The index measures the number of months it would take to sell the supply of homes on the market at the current sales rate.
The median number of days it took to sell a California single-family home increased in July. Time on market inched up from 19 days in June to 21 days in July. It took a median number of 18 days to sell a home in July 2018.
The average statewide price per square foot for an existing, single-family home statewide reached $290 in July 2019 and was $288 in July 2018.
The 30-year, fixed-mortgage interest rate averaged 3.77% in July, down from 4.53% in July 2018, according to Freddie Mac. The five-year, adjustable mortgage interest rate was an average of 3.47%, compared to 3.84% in July 2018.
This article was provided by the California Association of Realtors.
Construction could begin next year and require about 500 to 600 workers, with a permanent workforce starting at 150 to 200 people with potential to expand.