A bump in mortgage rates and a dramatic decline in consumer confidence with a jittery economy and huge drops in the stock market created some March madness for the housing market in California.
The current administration’s on-again, off-again trade war that hurt Wall Street also impacted home sales, with a seasonally adjusted annualized rate of 277,030 homes changing owners during the month, a 2.3% decline compared to February – and up 4.9% from a year ago, according to the California Association of Realtors. Home sales have been below the 300,000 level for 30 straight months, ongoing evidence of an anemic housing market that desperately needs a jump-start.
Four of the seven regions enjoyed an increase in sales in March compared to a year ago, with the Bay Area leading the way at 6.5%. Homes sales along the Central Coast – from Santa Barbara to Santa Cruz – dropped 6.7% from a year ago.
But any optimism could be short-lived, as pending homes sales – basically those in escrow – declined for the fourth straight month as would-be buyers worry about a recession and watch Wall Street.
“Both buyers and sellers grew more concerned about the ongoing tariff situation and its potential impact on their personal finances,” says CAR president Heather Ozur, a Palm Springs REALTOR. “With uncertainty weighing on those still striving for the American Dream, this is an important time for REALTORS to use their expertise to guide clients through the challenges.”
A BUYERS’ MARKET? MAYBE WITH MORE ACTIVE LISTINGS AND SMALLER PRICE GAINS
The biggest challenge to overcome? Home prices.
California’s median home price – meaning half the homes sold for more, the other half for less – climbed to $884,350 in March, a 6.7% increase compared to February and up 3.5% from a year ago.
Prices in all seven regions of the state increased in March from a year ago, a positive for homeowners who may see fewer shoppers down the road. New active listings increased 20% from February and have risen at the fastest pace since January 2023. Active listings are at a six-month high and have increased year-over-year for 14 straight months.
CAR chief economist Jordan Levine says the boost in home listings “offer hope for buyers seeking more options and improved affordability.”
Maybe, but cautious consumers could slow the door until the volatility wanes.
Home prices and sales in March compared to a year ago
| Region | Median home price | % gain or loss vs. a year ago | Home sales vs. a year ago |
|---|---|---|---|
| California | $884,350 | +3.5% | +4.9% |
| Bay Area | $1.4 million | +1.0% | +6.5% |
| Central Coast | $1.1 million | +16.6% | -6.7% |
| Central Valley | $495,000 | +3.4% | +2.5% |
| Far North | $385,000 | +3.4% | -1.2% |
| Inland Empire | $609,230 | +2.5% | -1.2% |
| Los Angeles | $834,830 | +4.2% | +0.6% |
| Southern California | $877,750 | +3.3% | -0.4% |
Source: California Association of Realtors
