Tag Archives: housing market

Money Monday: California Housing Affordability

Higher wages and seasonal price declines affect California housing affordability.

housing market forecast

• “Thirty-one percent of California households could afford to purchase the $511,360 median-priced home in the fourth quarter, unchanged from third-quarter 2016 and up from 30 percent in fourth-quarter 2015.” (“4th Qtr 2016 Housing Affordability”. CAR.org. 9 Feb 2017)

• “A minimum annual income of $100,800 was needed to make monthly payments of $2,520, including principal, interest, and taxes on a 30-year fixed-rate mortgage at a 3.91 percent interest rate.”

Read all about 2016’s housing marketing in the fourth quarter, in the CALIFORNIA ASSOCIATION OF REALTORS’ article here: “4th Qtr 2016 Housing Affordability“.

 

First-Time Home Buyers Have Increased

For the first time in three years, the percentage of home buyers in the real estate market has increased.

This infographic is from the CALIFORNIA ASSOCIATION OF REALTORS.

California Pending Home Sales Increase Moderately

Led by Southern California, state’s pending home sales trends in December.

Source: CALIFORNIA ASSOCIATION OF REALTORS®

Led by the Southern California region, California pending home sales registered gains on a month-to-month and year-to-year basis, portending a moderate increase in sales in the near term, the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) said today.housing market forecast

The modest sales growth is unlikely to be sustained, however, given the severe shortage of homes for sale and affordability concerns, as indicated in C.A.R.’s December Market Pulse Survey**, which saw fewer listing appointments and less open house traffic.

Based on signed contracts, statewide pending home sales increased in December on a seasonally adjusted basis, with the Pending Home Sales Index (PHSI)* rising 1.9 percent from 115.8 from December 2015 to 118.1 in December 2016 – even with new mortgage rules that pushed sales higher December a year ago.

  • On a monthly basis, California pending home sales were up 3.3 percent from the November index of 114.4.
  • Southern California saw the largest increase in pending sales last month, rising 7.8 percent on an annual basis and decreasing 16.1 percent on a monthly basis.
  • On the flip side, in the San Francisco Bay Area as a whole, tight housing supplies and low
    affordability contributed to a fall in pending sales of 14.2 percent compared to December 2015 and 32.5 percent from November.
  • Overall pending sales in the Central Valley improved 0.9 percent from December 2015 and were down 18.4 percent from November.
  • The share of homes selling below asking price fell from 57 percent a year ago to 43 percent in December. Conversely, the share of properties selling above asking price increased to 23 percent from 18 percent in December 2015. The remaining 34 percent sold at asking price, up from 25 percent in December 2015.
  • For homes that sold above asking price, the premium paid over asking price rose to 11 percent, up from 8.4 percent in November and 9.2 percent a year ago.
  • The 43 percent of homes that sold below asking price sold for an average of 22 percent below asking price in December, double the November figure of 11 percent, and was up from 13 percent from a year ago.

Read the full story: www.car.org/newsstand/newsreleases/2017releases/dec2016pending

Improved Affordability in California

Compared to this time last year, homes are slightly more affordable in California

  • The median price for a single-family home in California in 2016’s Q3 was $515,940.
  • 31% of households could afford to purchase a median-priced home — compared to 29% of households a year ago.
  • Least-affordable counties include: San Francisco, San Mateo, and Marin.
  • Most-affordable counties include: San Bernardino, Kings, and Kern.

CAR improved real estate affordability in California

This infographic is from the CALIFORNIA ASSOCIATION OF REALTORS

Money Monday: California sales and prices up in October

California home sales and median price post higher in October

Source: C.A.R.

marketBolstered by healthy sales activity in Southern California and the Central Valley, California existing home sales and median price gained ground in October on a month-to-month and year-over-year basis, the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) said today.

Closed escrow sales of existing, single-family detached homes in California totaled a seasonally adjusted annualized rate of 442,970 units in October, according to information collected by C.A.R. from more than 90 local REALTOR® associations and MLSs statewide. The statewide sales figure represents what would be the total number of homes sold during 2016 if sales maintained the October pace throughout the year. It is adjusted to account for seasonal factors that typically influence home sales.

The October figure was up 4.1 percent from the revised 425,680 level in September and up 8
percent compared with home sales in October 2015 of a revised 410,310. Home sales remained
above the 400,000 pace for the seventh straight month, and were up year-over-year for the second consecutive month. The year-over-year increase was the largest since January, and October’s sales level was the highest since July 2013.

“With prices continuing to increase amid a low supply of homes for sale on the market, especially in the San Francisco Bay Area and coastal regions, home buyers are migrating toward lowerpriced homes in more affordable inland areas,” said C.A.R. President Geoff McIntosh. “As a
result, home prices at the lower end of the market have risen significantly in the past year,
challenging an already depressed homeownership rate.”

The statewide median price remained above the $500,000 mark for the seventh straight month,
with little signs of slowing down. The median price of an existing, single-family detached
California home was up 1.2 percent in October to $513,520 from a revised $507,260 in
September. Since 2010, prices typically have declined from September to October. The monthly
price gain is an indication that demand remains unseasonably strong.

“While this month’s sales and price gains are encouraging, the market continues to experience a
supply issue that won’t abate any time soon,” said C.A.R. Vice President and Chief Economist
Leslie Appleton-Young. “A shortage of new listings remains a threat to home sales in the short
run, and with available inventory below normal levels, the dearth of listings suggests that the
market will remain tight over the near term.”

Full Story: www.car.org/newsstand/newsreleases/2016releases/oct2016sales

Millennials Make Up Half of US Real Estate Buyers

News from Zillow’s recent real estate study

HomeForSaleSignZillow released a study on Tuesday, revealing some of their real estate findings; including: “half of all buyers are under age 36, meaning the Millennial generation is driving more of the housing market than we previously understood.”

Another finding had to do with the hiring of real estate agents. They found that “buyers aren’t replacing the expertise of real estate agents with online research—but they are doing a tremendous amount of research online before contacting an agent. Those who start their home searches online are actually more likely to use an agent than other buyers.”

The report summarizes Zillow’s findings in a 164-page report; click here to read about all of the real estate findings in detail.

These large metros are seeing the fastest growth

Among others, San Diego metro area is one of the top 20 fastest growing economies

Source: CNBC

urban real estate prices, most live in suburbsThe San Jose metro economy is among the largest growing economies, according to the Bureau of Economic Analysis. San Jose’s 8.9 percent growth led the 292 metro areas that saw their local economies grow last year. San Francisco, Los Angeles, Riverside, and San Diego metro areas also ranked in the top 20 fastest growing economies at growth rates of 4.1 percent, 3.9 percent, 3.8 percent, and 2.5 percent, respectively.

While the economies of most major American metro areas have fully recovered, many smaller cities are still struggling to climb back to pre-recession levels.

Full story: www.cnbc.com/2016/09/20/these-large-metros-are-seeing-the-fastest-growth

Money Monday: Affordability Facts

Real estate affordability facts

The CALIFORNIA ASSOCIATION OF REALTORS put out some real estate facts concerning California real estate affordability:

  • 31% of California households can afford to purchase a median-priced single-family home in California.
  • $516,220 is the median single-family house price in California.
  • That would make the monthly payment about $2,730.
  • The minimum income needed to purchase a median-priced home is $101,217.
  • See more details below

Real estate affordability facts

This infographic is from the CALIFORNIA ASSOCIATION OF REALTORS.