Tuesday, Sept. 25, 2007
C.A.R. reports sales decrease 27.8 percent in August, entry-level median home price falls 5. 1 percent
LOS ANGELES (Sept. 25) – Home sales decreased 27.8 percent in August in California compared with the same period a year ago, while the median price of an existing home increased 2 percent, the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) reported today.
"Despite the overall increase in the statewide median price, prices declined in 11 regions last month, falling 11.5 percent in the Central Valley region and 12.1 percent in Sacramento," said C.A.R. President Colleen Badagliacco. "Price softness is even more pronounced when we look at different segments of the market. For example, the statewide median price in the entry-level price range of less than $500,000 fell 5.1 percent in August to $349,360 compared with $368,210 for the same period a year ago.
"The median price per square foot for a single-family home is also on the decline, falling 4.3 percent this year to $336 compared with last year’s record high of $351 per square-foot," she said.
Closed escrow sales of existing, single-family detached homes in California totaled 319,200 in August 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 decreased 27.8 percent from the 442,150 sales pace recorded in August 2006.
The statewide sales figure represents what the total number of homes sold during 2007 would be if sales maintained the August 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 August 2007 was $588,970, a 2 percent increase over the revised $577,300 median for August 2006, C.A.R. reported. The August 2007 median price increased 0.5 percent compared with July’s $586,030 median price.
"While low affordability, tighter underwriting standards and expectations of lower prices continue to pose challenges for the market, the decline in sales accelerated in August as a result of the so-called credit or liquidity crunch that began in July.," said C.A.R. Vice President and Chief Economist Leslie Appleton-Young. "The credit crunch emerged as uncertainty about the extent of the subprime problem drove investors across the globe to turn off the tap of funds to lenders in mortgage and other credit market segments. With credit drying up, even qualified buyers were unable to receive funding for home purchases."
"We expect the impact of the credit crunch to play out over the next several months, and that it will continue to negatively impact sales," she said.
Highlights of C.A.R.’s resale housing figures for August 2007:
C.A.R.’s Unsold Inventory Index for existing, single-family detached homes in August 2007 was 11.8 months, compared with 5.9 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 6.57 percent during August 2007, compared with 6.52 percent in August 2006, according to Freddie Mac. Adjustable-mortgage interest rates averaged 5.67 percent in August 2007 compared with 5.64 percent in August 2006.
The median number of days it took to sell a single-family home was 55.5 days in August 2007, compared with 50.9 days (revised) for the same period a year ago.
Regional MLS sales and price information is contained in the tables that accompany this press release. Regional sales data are not adjusted to account for seasonal factors that can influence home sales. The MLS median price and sales data for detached homes are generated from a survey of more than 90 associations of REALTORSâ throughout the state. MLS median price and sales data for condominiums are based on a survey of more than 60 associations. The median price for both detached homes and condominiums represents closed escrow sales.
In a separate report covering more localized statistics generated by C.A.R. and DataQuick Information Systems, 24.6 percent, or 88 out of 357 cities and communities, showed an increase in their respective median home prices from a year ago. DataQuick statistics are based on county records data rather than MLS information. DataQuick Information Systems is a subsidiary of Vancouver-based MacDonald Dettwiler and Associates. (The top 10 lists are generated for incorporated cities with a minimum of 30 recorded sales in the month.)
Note: Large changes in local median home prices typically indicate both local home price appreciation, and often, large shifts in the composition of housing market activity. Some of the variations in median home prices for August may be exaggerated due to compositional changes in housing demand. The DataQuick tables listing median home prices in California cities and counties are accessible through C.A.R. Online at http://www.car.org/index.php?id=Mzc3NzY .
Statewide, the 10 cities and communities with the highest median home prices in California during August 2007 were: Los Altos, $1,815,750; Manhattan Beach, $1,700,000; Saratoga, $1,620,000; Newport Beach, $1,550,000; Burlingame, $1,505,000; Palos Verdes Estates, $1,450,250; Calabasas, $1,330,000; La Canada/Flintridge, $1,317,500; Coronado, $1,315,000; Los Gatos, $1,255,000.
Statewide, the 10 cities and communities with the greatest median home price increases in August 2007 compared with the same period a year ago were: West Hollywood, 35.8 percent; Los Gatos, 35.7 percent; Encinitas, 27.7 percent; Los Altos, 26.2 percent; San Carlos, 21.9 percent; Los Angeles, 20.9 percent; Newport Beach, 18.3 percent; Burlingame, 18.3 percent; Cupertino, 17.4 percent; Novato, 17 percent; Santa Monica, 16.8 percent.
