The government shutdown and the typical end of summer doldrums dragged California home sales down in October, the third straight month of falling sales.  The California Association of Realtors® (C.A.R.) reports that sales of existing, single-family detached homes in the state fell to a seasonally adjusted annual rate of 401,170 units, down 2.7 percent from a revised 412,260 units in September and 11.1 percent below the rate of 451,090 in October 2012.

C.A.R. President Kevin Brown said, "As anticipated, the housing market was disrupted by the closure of the federal government in October, which prolonged the loan approval process and led to the delay of many home closings, especially on FHA transactions.  That said, we are returning to a market that's more balanced than we've seen in recent years, with home price gains that are more sustainable and a sales pace that's characteristic of a normal environment."

The median home price in October also edged down, declining 0.3 percent from September.  The statewide median price of an existing, single-family detached home was $427,290 in October compared to September's median price of $428,740 to $427,290.  The October number was still 25.3 percent above the median a year earlier making October the 16^th straight month that the median price jumped year-over-year by double digits.

"The recent jump in interest rates, coupled with the run-up in home prices since the beginning of this year, lowered housing affordability.  As such, many buyers are considering more affordable options such as condos and townhomes, especially in the San Francisco Bay Area, where there is a greater abundance of these property types," said C.A.R. Vice President and Chief Economist Leslie Appleton-Young.  "As housing demand has cooled off in recent months, however, the statewide median price is finally showing some signs of stability.  As we enter the slower home buying season, we expect home prices to be capped by seasonal factors and annual price gains to continue to taper off in the coming months."

Inventories dipped from 3.6 months in September to a 3.4 month supply of available existing single family detached homes.  In October 2012 the inventory was 3.1 month.  C.A.R. said a normal market typically has a six to seven month supply.

The median number of days it took to sell a single-family home increased to 33.1 days in October from 29.6 days in September, but was down from 38 days in October 2012.