While seasonal conditions are putting downward pressure on the sales of California single-family homes and condominiums, this isn’t bad news for the state, which has had a turbulent housing history.
October sales fell 2.9% to 35,182 from a revised 36,232 in September. On a yearly basis, sales barely moved, falling 1.0% from 35,541 in October 2014, the latest report from PropertyRadar said.
When the extra business day in October 2014 is taken into account, sales were unchanged year-over-year.
“Flat is the new black,” said Madeline Schnapp, director of economic research for PropertyRadar. “Sales posted healthy increases in the first half of 2015 relative to 2014 but beginning in July, sales weakened as rising prices began to meet resistance from prospective buyers. That scenario is unlikely to change anytime soon.”
"The California real estate market has been surprisingly resilient," continued Schnapp. "Sales, while weak historically, remain higher than we’d expect given limited inventory. Prices are higher than we’d expect given virtually no wage growth. Despite a terrifying drought and financial and stock market volatility, things are quite stable, if not flat-out boring. Where would we be without foreign investors and money flowing in to wage growth for a few of the unicorns of the tech industry?”
Year-to-date, sales were up 6.5% compared to the same period in 2014 thanks to strong sales in the first half of the year. Despite the increase, sales remain 30% to 40% below 2002 through 2006 sales volumes.
In addition, the median price of a California home in October was $407,500, nearly unchanged from a revised $407,000 in September. Prices peaked in July at $416,000 but have retreated to April 2015 levels.
On a monthly basis, prices have fallen in 17 of California’s 26 counties as the rapid price appreciation seen in the first half of the year started to fizzle out in all but a few of the most affluent counties.
The counties with the largest price increases were Marin (11.1%), Monterey (5.7%), Merced (2.4%) and Stanislaus (2.0%). The counties with the largest price declines were Contra Costa (-5.1%), San Mateo (-4.7%), Santa Barbara (-13.6%) and Santa Clara (-4.3%).