CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) has officially published the results from its latest report, which reveals that a modest improvement in mortgage rates and stabilization of home prices has spelled a marked uptick in California home sales.
Going by the available details, this particular report treads up a long distance to reveal that closed escrow sales of existing, single-family detached homes across California clocked a seasonally adjusted annualized rate of 264,240 in August.
More on that would reveal how, for the given timeframe, home sales activity edged up 0.9 percent from the 261,820 homes sold during July and slipped 0.2 percent from a year ago, when 264,640 homes were sold on an annualized basis. However, from an yearly standpoint, August’s sales level remained slightly below last year’s revised level and marked the fifth consecutive month of year-over-year sales declines.
Beyond that, it was also the 35th straight month which saw seasonally adjusted sales rate remaining below the 300,000 benchmark.
Statewide pending sales in August also rose 8.3 percent from July as mortgage rates fell to a 10-month low. Here, on a year-over-year basis, pending sales successfully edged higher by 0.2 percent for the first time in nine months.
“Despite a softer-than-expected home buying season this year, a bounce back in pending sales last month is an encouraging sign that sales could improve the rest of the year,” said Heather Ozur, a Palm Springs REALTOR® and C.A.R. President. “Many prospective homebuyers have been holding out in hopes of lower mortgage rates, and the declining trend in rates observed in the last few weeks could be the nudge that draw them back to the market.”
Talk about the whole report on a slightly deeper, we begin from how, at the regional level, only two of California’s major regions posted year-over-year sales gains on a non-seasonally adjusted basis. The Far North edged out a gain of 2.9 percent increase from a year ago, whereas on the other hand, Central Coast bested last year’s sales by 1.6 percent.
Against that, however, San Francisco Bay Area experienced the largest regional decline with sales falling 4.1 percent. As for Southern California (-3.7 percent) and the Central Valley (-3.5 percent), they both experienced moderate sales dips.
Turning our attention towards the county level, 24 of the 53 counties tracked by C.A.R. recorded year-over-year sales gains in August.
Out of the whole lot, Mariposa County (81.8 percent) emerged with the highest sales growth from last year, followed by Lassen (46.7 percent) and Kings (36.1 percent). In totality, 25 counties experienced annual sales declines in August. In fact, eight counties recorded sales drops of more than 10 percent including Yuba (-35.3 percent), Calaveras (-31.3 percent), and Tehama (-24.0 percent).
Moving on, three of California’s five major regions recorded year-over-year median home prices gains, but having said so, the other two experienced a decline. You see, the Central Coast led the way bearing a 6.3 percent price increase from August 2024, as San Francisco Bay Area median price climbed 2.8 percent year-over-year and the Southern California region’s median price rose a mild 1.2 percent.
As for the median price in the Far North region, it dropped 3.1 percent compared to last year, and slipped 1.0 percent in the Central Valley.
Rounding up highlights would be a pointer focused on Unsold Inventory Index (UII), which went up in August compared to July, as housing demand remained soft despite showing some slight improvement.
In essence, the index was 3.9 months in August, marking a slight increase from 3.7 in July and up from 3.2 months in August 2024. Total active listings, on the other hand, were up 23.5 percent from a year earlier.
“Soft sales demand led to a steady decline in California’s median home price for three consecutive months through early summer,” said, Jordan Levine, C.A.R. Senior Vice President and Chief Economist. “However, with a slight uptick in the median price in August and a stabilization in the number of reduced-price listings last month, the market appears to have found a short-term balance between supply and demand. “If mortgage rates maintain their current levels or decline further before year-end, positive year-over-year home price growth may continue in the next few months.”
