California housing market underperforms in July
Pending home sales drop four months straight
July was not a strong month for the California housing market as the state continued to underperform.
California pending homes sales dropped in July, with the pending home sales index falling 2.3% from 107 in June to 104.5 in July, based on signed contracts, according to the California Association of Realtors. However, the month-to-month drop was consistent with seasonal trends.
This is also down 9.2% from 115.1 in July 2013. “Pending sales have been down year to year since October 2012, but the pace appears to be decelerating as the decrease in July was smaller than the average in the last six months. Pending home sales are forward-looking indicators of future home sales activity, providing information on the future direction of the market,” CAR said.
As noted in the 3 facts crippling California’s housing recovery, the combined share of all distressed property sales continued to decrease in July, dropping from 9.7% in June to 9.4% in July.
On the other side, the share of equity sales — or non-distressed property sales — maintained its upward trend, increasing to 90.6% in July, from 90.3% in June.
Equity sales have steadily increased since the start of the year, making up more than 80% of total sales for more than two years and rising above 90% for the second straight month.
Despite the bad month for the market, next year is projected to be the best year yet for the economy since the start of the recovery, according to a report from Beacon Economics, with California's state economy lining up to do better than the nation.