California Home Sales Slip in September

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According to the California Association of Realtors, California existing home sales and median price retreated in September 2015.

Home sales remained above the 400,000 mark in September for the sixth consecutive month and posted higher on a year-to-year basis for the eighth straight month. Closed escrow sales of existing, single-family detached homes in California totaled a seasonally adjusted annualized rate of 425,030 units in September, according to information collected by C.A.R.
 
The statewide sales figure represents what would be the total number of homes sold during 2015 if sales maintained the September pace throughout the year.  It is adjusted to account for seasonal factors that typically influence home sales.

California September Home Sales Snapshot:

• Existing, single-family home sales totaled 425,030 in September on a seasonally adjusted annualized rate, down 1.5 percent from August but up 6.9 percent from September 2014.

•  Statewide sales were above the 400,000 mark for the sixth straight month.

• September's statewide median home price was $482,150, down 2.3 percent from August but up 4.3 percent from September 2014.

The September figure was down 1.5 percent from the revised 431,630 level in August but up 6.9 percent compared with home sales in September 2014 of a revised 397,490. The year-to-year change was lower than the 6-month average increase of 9.7 percent observed between March 2015 and August 2015.

"While home sales continue to improve from last year, it will be interesting to see what impact the new implementation of the Consumer Financial Protection Bureau's Know Before You Owe TILA-RESPA Integrated Disclosure, or TRID, will have on home sales in the future," said C.A.R. President Chris Kutzkey. "Some sales that would have closed in October may be delayed because of longer loan processing times. In the first week of its implementation, mortgage applications have already seen a significant drop, partially due to the volume that was pulled forward prior to TRID's effective date." 

The median price of an existing, single-family detached California home decreased 2.3 percent in September to $482,150 from a revised $493,510 in August.  September's median price was 4.3 percent higher than the revised $462,380 recorded in September 2014. 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 statewide median home price has been on the rise but may have already peaked for the year," said C.A.R. Vice President and Chief Economist Leslie Appleton-Young. "Home prices are moderating due partly to a shift in the mix of sales, as more homes are being sold in lower priced regions, such as the Central Valley, where the sales share increased from 25.5 percent last year to 26.4 percent in September. Conversely, the Bay Area experienced a drop in sales share from 18.8 percent to 17.2 percent during the same time period. This trend will likely persist through the rest of 2015."

Other key points from C.A.R.'s September 2015 resale housing report include:
 

• While sales continued to improve from last year at the state level, the number of active listings continued to drop from the previous year. Active listings for California dropped 1.9 percent from August and decreased 7.2 percent from September 2014.

• The September Unsold Inventory Index remained at 3.7 months, unchanged from August but was down from 4.2 months in September 2014. 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 typical in a normal market.

• The median number of days it took to sell a single-family home edged up in September to 32.6 days compared with 29.9 days in August but was down from a revised 36.3 days in September 2014.

• According to C.A.R.'s newest housing market indicator which measures the sales-to-list price ratio, properties are again generally selling below the list price, except in the San Francisco Bay Area, where a lack of homes for sale is pushing sales prices higher than original asking prices.  The statewide measure suggests that homes sold at a median of 98.5 percent of the list price in September, up slightly from 98 percent at the same time last year. The Bay Area is the only region where homes are selling above original list prices due to constrained supply with a ratio of 102.4 percent in September, up from 101.2 percent a year ago.

• The average price per square foot for an existing single-family home was $236 in September 2015, unchanged from August but up from a revised $231 in September 2014.  Price per square foot at the state level has been on an upward trend since early 2012 but appears to be leveling off and slowing to an average increase of 1.3 percent in the past three months as home price appreciation began to moderate.

• San Francisco had the highest price per square foot in September with $770/sq. ft., followed by San Mateo ($723/sq. ft), and Santa Clara ($577/sq. ft.).  The three counties with the lowest price per square foot in September were Madera ($118/sq. ft.), Kings ($118/sq. ft.), and Tulare ($120/sq. ft.).

• Mortgage rates dipped in September, with the 30-year, fixed-mortgage interest rate averaging 3.89 percent, down from 3.91 percent in August and 4.16 percent in September 2014, according to Freddie Mac.  Adjustable-mortgage interest rates also slipped, averaging 2.59 percent, down from 2.60 percent in August and 2.43 percent in September 2014.