California Homes Sales Increased 1.7% in December, Median Price Jumps Up 8.4%

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(LOS ANGELES, CA) -- Home sales increased 1.7 percent in December in California compared with the same period a year ago, while the median price of an existing home rose 8.4 percent, the California Association of Realtors (C.A.R.) reported today.

"As expected, the large year-to-year sales gains have diminished substantially compared with earlier in the year," said C.A.R. President Steve Goddard.  "However, home sales in December were strong, and were comparable to sales of late 2008.  Activity in December can be attributed in part to the extension and expansion of the home buyer tax credit, as well as near-historic highs in affordability due to current price levels and low interest rates.

"For the second consecutive month, California's median home price rose year-to-year in December, and had the largest year-to-year increase in more than three years," said Goddard.  "The state's median price also remained above $300,000 for the second straight month."

Quick Facts:

• Existing, single-family home sales increased 4 percent in December to a seasonally adjusted rate of 558,320 units on an annualized basis.

• The statewide median price of an existing single-family home increased 0.8 percent in December to $306,820, compared with November 2009.

• C.A.R.'s Unsold Inventory Index fell to 3.8 months in December, compared with 5.6 months in December 2008.

Closed escrow sales of existing, single-family detached homes in California totaled 558,320 in December at a seasonally adjusted annualized rate, according to information collected by C.A.R. from more than 90 local Realtor associations statewide. Statewide home resale activity increased 1.7 percent from the revised 549,190 sales pace recorded in December 2008. Sales in December 2009 increased 4 percent compared with the previous month.

The statewide sales figure represents what the total number of homes sold during 2009 would be if sales maintained the December pace throughout the year. It is adjusted to account for seasonal factors that typically influence home sales.

The median price of an existing, single-family detached home in California during December 2009 was $306,820, an 8.4 percent increase from the revised $283,060 median for December 2008, C.A.R. reported. The December 2009 median price rose 0.8 percent compared with November's $304,520 median price.

"Home sales were unusually strong in December and were more consistent with peak season trends," said C.A.R. Vice President and Chief Economist Leslie Appleton-Young.  "Historically, the median price declines November through February and then rises in March.  However, lean inventory, historically low interest rates, and incentives for home buyers have resulted in California's housing market experiencing non-seasonal variations.

"Looking forward, we expect the state's median home price to fluctuate around the $300,000 level throughout the first quarter," said Appleton-Young.  "While we expect to experience price gains in the near term, it remains to be seen how the market will fare once the Federal Reserve discontinues its purchase of mortgage-backed securities."

Highlights of C.A.R.'s resale housing figures for December 2009:

• C.A.R.'s Unsold Inventory Index for existing, single-family detached homes in December 2009 was 3.8 months, compared with 5.6 months (revised) for the same period a year ago. The index indicates the number of months needed to deplete the supply of homes on the market at the current sales rate.

• Thirty-year fixed-mortgage interest rates averaged 4.93 percent during December 2009, compared with 5.29 percent in December 2008, according to Freddie Mac. Adjustable-mortgage interest rates averaged 4.31 percent in December 2009, compared with 4.97 percent in December 2008.

• The median number of days it took to sell a single-family home was 35.3 days in December 2009, compared with 46.3 days (revised) for the same period a year ago.

• Statewide, the 10 cities with the highest median home prices in California during December 2009 were: Beverly Hills, $1,400,000; Los Altos, $1,340,000; Laguna Beach, $1,230,000; Manhattan Beach, $1,165,000; Palos Verdes Estates, $1,160,000; Palo Alto, $1,066,000; Los Gatos, $994,500; Newport Beach, $938,500; Rancho Palos Verdes, $900,000; and Santa Monica, $852,500.

• Statewide, the cities with the greatest median home price increases in December 2009 compared with the same period a year ago were:  Laguna Hills, 62.9 percent; San Juan Capistrano, 37.2 percent; Fairfield, 30.9 percent; Tustin, 27.1 percent; El Cajon, 26.7 percent; Thousand Oaks, 19.5 percent; Escondido, 18.4 percent; Costa Mesa, 17.3 percent; San Pablo, 16.6 percent; and Encinitas, 16.3 percent.

 

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