Sunday, September 27, 2009

CA Real Estate Recovery: Home Sales Increase for 14th Straight Month, Median Prices for 6th Month

LOS ANGELES (Sept. 25) Home sales increased 9% in August in California compared with the same period a year ago, while the median price of an existing home declined 16.9%, the CALIFORNIA ASSOCIATION OF REALTORS (C.A.R.) reported (see chart above). Closed escrow sales of existing, single-family detached homes in California totaled 526,970 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 increased 9% from the revised 483,400 sales pace recorded in August 2008.

The median price of an existing, single-family detached home in California during August 2009 was $292,960, a 16.9% decrease from the revised $352,730 median for August 2008, C.A.R. reported (see chart above). The August 2009 median price rose 2.6% compared with July’s $285,480 median price.

“The statewide median price rose for the sixth consecutive month in August,” said C.A.R. Vice President and Chief Economist Leslie-Appleton-Young. “Recent price gains are consistent with the low inventory levels of the past few months. Levels of distressed properties remain high, but have declined compared with earlier in the year, and are one reason why inventory levels are running below the state’s long-run average of 7.2 months.

C.A.R.’s Unsold Inventory Index for existing, single-family detached homes in August 2009 was 4.3 months, compared with 7 months for the same period a year ago (see chart above). The index indicates the number of months needed to deplete the supply of homes on the market at the current sales rate.

MP: In a separate report,
DQNews reported that the August increase in California home sales was the 14th consecutive monthly sales increase on a year-over-year basis. Increasing home sales for 14 straight months, increasing median home prices for the last six months, and an unsold inventory index of almost 40% lower than a year ago - if those conditions do not reflect a true, solid real estate recovery in the California real estate market, how would a real recovery be any different?


At 9/27/2009 11:07 AM, Anonymous Deven said...

How would a recovery be different?

California... Early 1990's... Nearly four consecutive years of falling, stagnant, or very slightly appreciating house prices.

California already has a record high foreclosure rate which is being slowed down only by legislation passed in February requiring a modification attempt. It will only stall the inevitable. Foreclosures will increase for the rest of the year and into next year. Sales already fell from July to August. The recovery is losing its wind, and so is your argument.

At 9/27/2009 8:52 PM, Anonymous Steve said...

Real Estate created this recession and a real estate recovery should end this recession. Good to see California has turned the corner.

At 9/27/2009 10:42 PM, Anonymous residential real estate said...

I like your blog it looks professional I enjoy reading it. Thanks!

At 9/28/2009 5:22 PM, Blogger Doug said...

There is a vast shadow inventory of unsold houses kept off the market by banks.
The Dr. Housing Bubble Blog has documented this extensively in many articles on the subject.
Rather difficult to have a housing "recovery" when unemployment is 12%, and the state government is virtually bankrupt.

Obviously there will be sales when prices have fallen at record rates and almost half of the sale have been foreclosures, in some months.

It is well known that many people who have stopped paying on their mortgages are not being pursued by banks, it being better to have the houses occupied than vacant and getting trashed.
...also shields banks from liability, leaving homeowners liable whether they are paying or not, and whether they have moved out or not.
Realtors are blowing smoke, but what's new?
Great article on the effect of socialized medicine on innovation, however!

That's what's wrong with California's economy:

Out of control Government Spending on stifling Social Welfare Programs and Dysfunctional Government Schools.

At 9/28/2009 5:35 PM, Blogger Doug said...

Good comments by and Nicolas, in the Healthcare thread, however showing there are many ways big government can bring about failure.

At 9/28/2009 9:00 PM, Anonymous Anonymous said...

Statistical Significance????


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