California Builders Believe State's New Home Sales Decline Slowing

Year-over-year declines in California's new home sales market continued to shrink in September, a signal perhaps that the market is stabilizing. Sales in projects with 10 or more units were 11% below September 2008's total. But that's an improvement from the 13% year-to-year decline reported in August, and stands in stark contrast to much greater declines posted earlier this year, according to the monthly count by the California Building Industry Association and the Hanley Wood Market Intelligence research firm. Overall, just 2,310 new houses and condominiums were sold in September in the subdivisions tracked by the Costa Mesa-based HWMI. Compared with September 2008, the median base price of a new house statewide fell 6%. Jonathan Dienhart, director of published research for HWMI, said the slowdown in the slowdown is a "good sign" that the market is starting to reach a balance. But he also said that given "the dismal conditions" that 2009 figures are being compared with, it is still too early to make the call that a recovery is in the winds. "Broader economic issues, especially job losses, will continue to be a drag on the housing market and prevent it from a return to healthy equilibrium," Mr. Dienhart said. CBIA is pushing California lawmakers to follow the lead on Congress by re-instituting the state's $10,000 homebuyer tax credit.