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March madness: Home prices, sales rebound

March madness: Home prices, sales rebound

By Ron Trujillo/ron@calhomenews.com

California’s housing market bounced back from a couple months of lackluster gains in March, and another county joined the million-dollar club.

The better-than-expected performance is a positive sign for the spring home-buying season, especially as home shoppers deal with fast-rising prices and a serious lack of inventory.

Existing home sales reached 416,580 units in March, a 4% increase from February and an impressive 6.9% from a year ago, according to the California Association of Realtors. The figure is an adjusted annualized rate, the total number of homes that would sell if the March pace were maintained for a year.

Geoff McIntosh

“March’s solid sales performance was likely influenced by the specter of higher interest rates, which may have pushed buyers off the sidelines and close escrow before rates moved higher,” CAR president Geoff McIntosh. “The strong housing demand, coupled with a shortage of available homes for sale, is pushing prices higher as would-be buyers try to purchase before affordability gets worse.”

Affordability is a major concern for consumers, especially first-time homebuyers, economists and even real estate officials. Less than one of every three households could afford to buy the median-priced home during the fourth quarter, according to CAR. The figure is much lower in the Bay Area.

The median-home price – meaning half the homes sold for more, the other half for less – topped $500,000 in March, an 8% increase compared to February and up 6.8% from a year ago. The price had dropped below the half million-dollar mark in January and February, prompting some to say the price run-up had reached its peak.

Finding a home could soon become more difficult than paying for one. New statewide active listings declined 12% from a year ago, and the unsold inventory index fell to the lowest level in a year – and the third-lowest rate during the past three years. The state has a three-month inventory of homes at the current pace, compared to four months in February.

Leslie Appleton-Young

“The spring home-buying season is off to a good start, as the economic and market fundamentals remain solid for the most part,” says Leslie Appleton-Young, senior vice president and chief economist for CAR. “However, higher interest rates, a dearth of housing inventory and slow wage growth will continue to have an adverse effect on housing affordability that is putting upward pressure on home prices and is sure to hamper the market throughout the year.”

San Francisco and San Mateo counties boast the highest prices in the state at $1.35 million. Despite the 12% annual boost in price in San Mateo, the county had an 8.6% increase in sales.

Marin and Santa Clara counties followed with price at $1.25 million $1.13 million, respectively. Lassen County had the lowest price at $182,000.

You can check county-by-county home prices and sales here.

Fresno

$245,000, up 6.1%

Los Angeles

$465,810, up 5.5%

Sacramento

$326,750, up 7.1%

San Diego

$571,000, up 3.8%

San Francisco

$1.35 million, down 0.4%

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