There were 267,880 closed escrow sales of existing, single-family detached homes in California in April, the California Association of Realtors (CAR) said in a report late last week.
The annualized sales figure represents the total number of homes sold during 2023, maintaining the April pace throughout the year. It is also adjusted to account for seasonal factors.
April’s sales pace was down 4.7 percent on a monthly basis from 281,050 in March and down a whopping 36.1 percent from a year ago, when a revised 418,970 homes were sold on an annualized basis.
Sales of existing single-family homes in California are now stuck at the 300,000-unit pace for the seventh consecutive month. Sales in Southern California dropped 37.4 percent, declining at a faster pace than the prior month, as each California local region also fell by more than a third on a year-over-year basis.
“While home sales declined in April, the market is getting more competitive as we’re seeing time on the market before selling down to 20 days in April from 33 days in January and the share of homes sold above asking price double from one in five at the beginning of the year to more than two in five in April,” said C.A.R. President Jennifer Branchini, a Bay Area realtor.
“This increase in market competition continued to provide support to the statewide median home price in April, which climbed above $800,000 for the first time in six months,” she added
California’s median home price surpassed $800,000 in April for the first time since October 2022, increasing 3.0 percent from March’s $791,490 to $815,340.
April’s median price was also lower on a year-over-year basis for the sixth consecutive month, declining 7.8 percent from the revised $884,680 recorded last April. The sizable drop in median price from last year was due partly to the strong price surge in early 2022 when homebuyers took advantage of low rates before the Fed began raising rates aggressively.
“Home sales remained soft as the lock-in effect continued to tighten housing supply and keep would-be sellers from listing their homes for sale, which contributed to a 30 percent year-over-year drop in new statewide active listings ― the largest drop since May 2020 when the pandemic shutdown took place,” said CAR Senior Vice President and Chief Economist Jordan Levine.
“A surge in borrowing costs as mortgage rates surpassed 7% in late February and early March also contributed to the market weakness, as many transactions that opened in those two months were closed in April,” Levine added.
CAR NOW projects existing single-family home sales to reach 279,900 units in 2023, a decline of 18.2 percent from the 342,000 units sold in 2022.
The California median home price is projected to decrease 5.6 percent to $776,600 in 2023, down from the annual median price of $822,300 recorded in 2022.
The updated projection on the statewide median price is an increase from the estimate of $758,600 forecast last October. CAR also projects that the 30-year fixed mortgage interest rate will average 6.3 percent for the year.
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