For the last few months the National Association of Realtors® (NAR) has been making some general statements that tight inventories of existing homes are "in some locations" impacting home sales. Today the California Association of Realtors® (C.A.R.) confirmed that they are one of those locations.
C.A.R. said that "A continued shortage of available homes for sale lowered California home Sales in September, while the median price reached the highest level in more than four years." Closed escrow sales of existing single-family residences (SFR) were at a seasonally adjusted annual rate of 484,240 units, down 5.2 percent from sales in August and 1.2 percent lower than in September 2011.
The tight inventory of unsold homes eased slightly in September, edging up to a 3.7 month supply from 3.2 months in August but down from 5.3 months in September 0211. A six to seven-month supply of homes is considered normal. At the same time homes are selling much more quickly. The median number of days it took to sell a single-family home in September was 39.3 days compared to 41.1 days in August and 54.2 days one year earlier.
"For the state, at 3.7 months of supply, unsold inventory is still less than half what it would be in a normal market," said C.A.R. Vice President and Chief Economist Leslie Appleton-Young. "As a result of the constrained supply at the moderate and lower end of the market, sales of homes priced under $200,000 dropped nearly 28 percent, and homes priced $200,000-$300,000 fell more than 15 percent in September. By contrast, in the upper price range, where inventory isn't as much of an issue, sales of homes priced $400,000-$500,000 rose more than 14 percent, and those priced above $500,000 increased more than 15 percent."
Good news for many California homeowners, hundreds of thousands of whom have been underwater on their mortgages, prices are increasing. The statewide median price of an existing SFR was $345,000 in September compared to $343,820 in August. The September number was 19.5 percent above the median price of $288,700 in September 2011. This was the seventh consecutive month that median prices increased both year-over-year and month-over month and was the highest since August 2008 when the median price was $352,730
The median price for a condo/townhome in September was $264,880 compared to $258,700 in August and $221,440 in September 2011. These are increases of 2.4 percent and 19.6 percent respectively.
These are, however median figures for the state and there was tremendous variability by region. C.A.R. President LeFrancis Arnold said, "Sales in the inland and coastal markets continue to move in different directions. Low inventory - especially in distressed areas - is dampening sales activity. In many of these areas, there is a one- to two-month supply of REO homes on the market.
The Inland Empire and the Central Valley have experienced double-digit sales declines compared with last year. Meanwhile, sales were higher in San Diego and most Bay Area counties, where the economies appear to be growing faster than the rest of the state."
