Resale home prices rise for 11th straight month

By Inman News, Monday, October 25, 2010.

Sales of existing single-family homes in California fell in September compared to the same period a year ago, according to a report by the California Association of Realtors.

The seasonally adjusted annualized rate for sales was 466,580 last month — a 12.2 percent drop from September 2009, which had a revised 531,180 sales rate. Meanwhile, last month’s sales rose 3.8 percent from August’s revised rate of 449,290. The association’s figures are based on closed escrow sales.

“We’ve seen a gradual improvement in the market over the past few months as we moved away from the influence of the tax credits, which pulled sales forward to the first part of the year,” said Steve Goddard, CAR’s president, in a statement.

“Additionally, the current mortgage moratoria, which weren’t announced until the end of September, wouldn’t have affected September sales.”

September also marked the 11th straight month of year-over-year sales price gains. The median price of an existing single-family home was up 4.5 percent compared to September 2009, to $309,900. The median fell 2.7 percent from August.

“The inventory of homes priced under $500,000 continues to be lean, which is driving moderate or significant price appreciation in this price category,” said Leslie Appleton-Young, CAR’s vice president and chief economist, in a statement.

“Conversely, the inventory of homes priced $1 million and higher is more than double the inventory of the under-$500,000 range, which is contributing to weaker prices at the high end.”

The Santa Barbara South Coast region experienced the greatest year-over-year price increase in September, 17.3 percent, to a median price of $879,750. Sales in the region fell 12.9 percent year-over-year. The San Luis Obispo region saw the sharpest year-over-year price drop in the state, 8.9 percent, to a median $354,880. Sales there fell 9 percent year-over-year.

All but two regions in the state experienced year-over-year decreases in sales. In Northern California (which CAR separates from the San Francisco Bay and Sacramento regions), sales rose 1 percent, and in Ventura, sales rose 5.6 percent. The High Desert saw the largest drop in sales, down 33.1 percent.

Inventory is rising: the association’s Unsold Inventory Index indicated that it would take 6.2 months to sell every home on the market at the September sales pace, up from 6.1 months in August and 4.5 months in September 2009. The index’s increase may be partially attributed to a rise in the median number of days a single-family home spends on the market: 52.5 days last month compared with 33.5 days in September 2009.

A six-month supply is generally considered to indicate a rough equilibrium between a buyer’s market and a seller’s market.

Interest rates for a 30-year fixed mortgage are down significantly from last year: from an average of 4.35 percent in September to 5.06 percent in September 2009, the association said, citing figures from Fannie Mae.

Foreclosed properties accounted for 35.8 percent of the existing homes sold last month, up from a revised 35.7 percent in August and down from 41.7 percent in September 2009, according to a separate report from real estate information company MDA DataQuick. The state experienced the highest share of foreclosed properties in February 2009 at 58.5 percent, the report said.

According to DataQuick, September sales of new homes, condos and existing single-family homes were down 3.1 percent from August and 17.5 percent from September 2009, to an estimated 33,176 homes. The median sales price was $265,000, up 1.9 percent from August, and up 5.6 percent from September a year ago, according to the report.