The Boy in the Big Housing Bubble: California Prices UP, Sales DOWN

The California Association of Realtors released its October numbers today.

The median price for the state is up a whopping 17.2 percent from last year, but sales are down 2.8 percent. Here's the news release:

The median price of an existing home in California in October increased 17.2 percent and sales decreased 2.8 percent compared with the same period a year ago, the California Association of REALTORS® (C.A.R.) reported today.

“While California is still experiencing year-over-year double-digit price appreciation, prices are starting to level off compared with the statewide peak reached in August 2005,” said C.A.R. President Vince Malta. “Regionally, the median price continues to post strong gains, with the High Desert, Riverside/San Bernardino, and San Luis Obispo regions hitting record highs last month.”

Closed escrow sales of existing, single-family detached homes in California totaled 621,530 in October 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 decreased 2.8 percent from the 639,570 sales pace recorded in October 2004.

The statewide sales figure represents what the total number of homes sold during 2005 would be if sales maintained the October pace throughout the year. It is adjusted to account for seasonal factors that typically influence home sales.

The median price of an existing, single-family detached home in California during October 2005 was $538,770, a 17.2 percent increase over the revised $459,530 median for October 2004, C.A.R. reported. The October 2005 median price decreased 1 percent compared with September’s $543,980 median price.

“Year-to-date sales in October were 3.1 percent above last year’s level, on track with our expectations for 2005,” said C.A.R. Vice President and Chief Economist Leslie Appleton-Young.

Highlights of C.A.R.’s resale housing figures for October 2005:

. C.A.R.’s Unsold Inventory Index for existing, single-family detached homes in October 2005 was 4 months, compared with 3 months (revised) for the same period a year ago. The index indicates the number of months needed to deplete the supply of homes on the market at the current sales rate.

. Thirty-year fixed mortgage interest rates averaged 6.07 percent during October 2005, compared with 5.72 percent in October 2004, according to Freddie Mac. Adjustable mortgage interest rates averaged 4.86 percent in October 2005 compared with 4.02 percent in October 2004.

. The median number of days it took to sell a single-family home was 35 days in October 2005, compared with 34 days (revised) for the same period a year ago.

Regional MLS sales and price information is contained in the tables that accompany this press release. Regional sales data are not adjusted to account for seasonal factors that can influence home sales. The MLS median price and sales data for detached homes are generated from a survey of more than 90 associations of REALTORS throughout the state. MLS median price and sales data for condominiums are based on a survey of more than 60 associations. The median price for both detached homes and condominiums represents closed escrow sales.

In a separate report covering more localized statistics generated by C.A.R. and DataQuick Information Systems, 97 percent or 391 of 403 cities and communities showed an increase in their respective median home prices from a year ago. DataQuick statistics are based on county records data rather than MLS information. DataQuick Information Systems is a subsidiary of Vancouver-based MacDonald Dettwiler and Associates. (The top 10 lists are generated for incorporated cities with a minimum of 30 recorded sales in the month.)

Note: Large changes in local median home prices typically indicate both local home price appreciation, and often, large shifts in the composition of housing market activity. Some of the variations in median home prices may be exaggerated due to compositional changes in housing demand. The DataQuick tables listing median home prices in California cities and counties are accessible through C.A.R. Online at http://www.car.org/index.php?id=MzU2NTg=.

. Statewide, the 10 cities and communities with the highest median home prices in California during October 2005 were: Laguna Beach, $1,670,000; Los Altos, $1,585,000; Manhattan Beach, $1,437,500; Burlingame, $1,400,000; Saratoga, $1,377,500; Newport Beach, $1,305,000; Calabasas, $1,162,000; Santa Barbara, $1,125,000; Mill Valley, $1,062,500; Los Gatos, $985,000; Rancho Palos Verdes, $985,000.

. Statewide, the 10 cities and communities with the greatest median home price increases in October 2005 compared with the same period a year ago were: Twentynine Palms, 93 percent; Laguna Hills, 76.1 percent; Upland, 52.3 percent; Yucca Valley, 52.3 percent; Sanger, 48.4 percent; Oakdale, 47.8 percent; Desert Hot Springs, 47.7 percent; Porterville, 47.5 percent; Patterson, 46.5 percent; Rosemead, 45 percent; Rancho Cordova, 43.9 percent.

Leading the Way...® in California real estate for 100 years, the California Association of REALTORS® (www.car.org) is one of the largest state trade organizations in the United States, with more than 180,000 members dedicated to the advancement of professionalism in real estate. C.A.R. is headquartered in Los Angeles.