Bolstered by strong sales in higher-priced regions, California median home price records largest year-to-year gain since 1980, C.A.R. reports
LOS ANGELES (June 17) – Strong sales growth in higher-priced markets and continued housing supply shortage pushed up California’s median home price in May, resulting in the largest year-over-year price gain in at least the last 33 years, the CALIFORNIA ASSOCIATION OF REALTORS ® (C.A.R.) reported.
“It’s encouraging to see median home prices across most parts of the state continuing to recover. The Bay Area, in particular, has been experiencing strong price appreciation, thanks to the region’s robust economic growth, extremely low housing inventory, and an increasing demand from international buyers,” said C.A.R. President Don Faught. “San Francisco County’s median home price, for example, increased 28 percent from last May and has just surpassed its previous record high reached in May 2007.”
Closed escrow sales of existing, single-family detached homes in California totaled a seasonally adjusted annualized rate of 431,370 units in May, according to information collected by C.A.R. from more than 90 local REALTOR® associations and MLSs statewide. Sales in May were up 1.9 percent from a revised 423,420 in April but down 3.6 percent from a revised 447,530 in May 2012. The statewide sales figure represents what would be the total number of homes sold during 2013 if sales maintained the May 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 rose 3.6 percent from April’s median price of $402,760 to $417,350 in May. May’s price was up 31.9 percent from a revised $316,460 recorded in May 2012, marking 15 straight months of annual price increases and the eleventh consecutive month of double-digit annual gains. The year-over-year price increase was the highest since at least 1980, when C.A.R. began tracking this statistic. 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.
“While home prices are increasing at levels above those observed in 2006-2007, the fundamentals of the housing market are much more solid than what we experienced a few years ago,” said C.A.R. Vice President and Chief Economist Leslie Appleton-Young. “More home buyers are putting down larger down payments, and many of them are opting for more stable loan products. Additionally, historically low mortgage rates have reduced monthly mortgage payments substantially, making owning a house more affordable, even with rising home prices.”
Other key facts of C.A.R.’s May 2013 resale housing report include:
- The available supply of homes for sale dipped in May, and was down markedly from a year ago. The May Unsold Inventory Index for existing, single-family detached homes was 2.6 months, down from 2.8 months in April, and down from a revised 3.6 months in May 2012. 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 normal.
- Homes sold slightly more quickly in May, with the median number of days it took to sell a single-family home decreasing to 27.1 days in May, down from 27.9 days in April and down from a revised 45.7 days for the same period a year ago.
- Mortgage rates ticked up in May, with the 30-year fixed-mortgage interest rate averaging 3.54 percent, up from 3.45 percent in April 2013 but was down from 3.80 percent in May 2012, according to Freddie Mac. Adjustable-mortgage interest rates in May averaged 2.55 percent, down from 2.63 in April and down from 2.74 percent in May 2012.