California Housing Market Enjoys Impressive Price Gains in April, Median Now Above $300,000

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According to the California Association of Realtors (CAR), California home sales and median price both jumped in April, with sales shooting up to their highest level in more than two years, while the median price rising above $300,000 for the first time in 16 months.

"A brighter economic picture, coupled with record-high housing affordability, pushed the spring home buying season off to a strong start," said C.A.R. President LeFrancis Arnold.  "With a continuing improving economy and interest rates declining to new record lows in recent weeks, we should see a steady improvement in the housing market throughout the end of the year."

Closed escrow sales of existing, single-family detached homes in California rose to a seasonally adjusted annualized rate of 555,300 units in April, according to information collected by C.A.R. from more than 90 local Realtors associations and MLSs statewide.  Sales in April were 10 percent higher than March's pace and 11 percent higher than in April 2011.  The statewide sales figure represents what would be the total number of homes sold during 2012 if sales maintained the April 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 climbed 5.7 percent in April to $308,050, up from March's revised $291,330 median price and 4.7 percent from a revised $294,140 recorded in April 2011.  The median price rose above the $300,000 mark for the first time since December 2010.

"The median home price climbed for the second straight month with solid gains from both the previous month and year," said C.A.R. Vice President and Chief Economist Leslie Appleton-Young.  "A sales improvement in the higher price segments of the housing market was a contributing factor to the price increase, as non-seasonally adjusted sales of homes priced higher than $500,000 increased nearly 11 percent, while sales of homes below $500,000 edged up a modest 2.1 percent."

"Additionally, the strong sales increase of higher-priced homes resulted in a considerable decline of inventory of homes in the higher price ranges when compared with last year.  This signifies the tight supply conditions we've been experiencing in the lower price ranges over the past several months are now extending into the upper price ranges."

Other key points of C.A.R.'s April 2012 resale housing report include:

• California's housing inventory remains low, with the Unsold Inventory Index for existing, single-family detached homes remaining at 4.2 months in April, unchanged from a revised 4.2 months in March.  April's housing inventory was down from a revised 5.6 months in April 2011.  The index indicates the number of months needed to sell the supply of homes on the market at the current sales rate.  A 7-month supply is considered normal.

• Interest rates remained extremely low in April, with 30-year fixed-mortgage interest rates averaging 3.91 percent, down from 4.84 percent in April 2011, according to Freddie Mac.  Adjustable-mortgage interest rates averaged 2.78 percent in April 2012, compared with 3.20 percent in April 2011.

• The median number of days it took to sell a single-family home fell to 49.3 days in April 2012, down from a revised 53.2 days for the same period a year ago.