Home sales in California were down over 5 percent in September as buyers, according to the California Association of Realtors® (C.A.R.) reacted to rising rates and economic uncertainty. At the same time the supply of available properties continued to loosen up as the housing market entered the off season.
Sales of existing, single-family detached homes in the state were at a seasonally adjusted annual rate of 412,880 units in September, 5.1 percent below the revised rate of 434,910 in August and 2.6 percent below the rate of 424,000 one year earlier.
Prices in the state also backed off the superheated pace they had been on, with the median home price down in September for the first time since February. The median price of an existing, single-family detached home in the state was $428,810 in September, 2.8 percent below the median of $441,330 in August. That September's price, though down, was 24.4 percent higher than the revised median of $344,760 in September 2012 shows how frothy the California market has been over the last year although a median price is influenced by the type of home being sold as well as price appreciation.
"The debate leading up to the expected tapering of the Fed's stimulus program caused interest rates to rise over the past several months and might have put some of the housing demand on hold," said C.A.R. Vice President and Chief Economist Leslie Appleton-Young. "While interest rates have decreased since the Fed's decision last month to postpone the pullback, the government shutdown and debt ceiling discussions over the past two weeks are likely to have an adverse effect on October home sales."
The available supply of existing, single-family detached homes for sale rose in September to 3.6 months about the same as a year earlier but up from August's Unsold Inventory Index of 3.1 months. A six- to seven-month supply is considered typical in a normal market.
"It's encouraging that housing inventory has been steadily improving since May, when housing supply hit its recent bottom," said C.A.R. President Don Faught. "While inventory remains constrained in the lower-priced home segment and primary home buyers continue to compete with investors, the number of properties for sale overall has been rising since March 2013 and is at its highest level since mid-2012."
The median marketing time for a home increased to 29.6 days on the market from 28.8 days in August. In September 2012 it took a median of 39.2 days to sell a home.
