California's Housing Market Loses Steam
Home sales in California are beginning to show signs of weakness as a lack of affordable housing begins to weigh on the Golden State's real estate market.
The California Association of Realtors reported Thursday that August's closed escrow sales of existing single-family homes came to a seasonally adjusted annualized rate of 420,360, an increase of 1.1% from July but a 2.2% drop from a year ago. August was the sixth consecutive month in which there was a year-over-year decline, even though sales remained above a rate of 400,000 for the fifth straight month.
"We are seeing the market tempering, which is being driven by reduced affordability and not enough homes for sale on the market, particularly in the San Francisco Bay regions, where runaway home prices have constrained home sales," CAR President Pat "Ziggy" Zicarelli said in a news release.
"Two of the region's least affordable counties — Marin and Santa Clara — saw sales fall from a year ago, while Contra Costa and Sonoma counties experienced more modest slowdowns."
The statewide median price was up 5.8% year-over-year at $526,580. The median home price in the lowest-priced segment was $205,000 in August, 11% higher than in 2015 despite there being 27% fewer listings.
Still, there were some bright spots, according to CAR: Parts of the state's Central Valley region experienced upticks from 2015 in home sales volume. And the sales of condominiums remained strong, given their relative affordability.