Improving economy translates to California housing in March
Improvement in the overall economy and favorable market condition led to increases in both California home sales and median sale price in March, according to the California Association of Realtors. The organization reported home sales up 3.1% over February and up 1.5% compared to March 2010, to an annualized rate of 514,090 homes. This number represents the number of homes that would sell during 2011 if sales remain on pace with last month. "For the first time in many months, we are seeing a genuine improvement in the overall economy, especially with respect to jobs," commented Beth Peerce, president of CAR. "However, while interest rates and current home prices are favorable, uncertainty about whether the economy has stabilized, concerns about inflation, and an unresolved state budget have created hesitation among buyers." San Diego-based DataQuick reported an estimated 36,500 new and resale homes and condos were sold during March, up 33.3% form February. Distressed properties accounted for 57% of homes sold. As home sales are increasing, unsold inventory is diminishing. In March, the backlog of unsold homes dropped to 5.3 months from 7.3 months in February. One year ago, housing inventory accounted for a 4.8-month supply. The supply of single-family residencies on the market increased 1.5% in March compared to one year prior, while condo and town home inventory dropped 1.2% compared to the same time period. The median number of days it took to sell a single-family home was 56.7 days in March 2011, compared with 37 days for the same period a year ago, CAR said. The median sale price increased 5.4% on a monthly basis to $286,010, according to CAR. Although the firm reported this price is 4.9% below the median price in March 2010, CAR said the data are no cause for concern, as 2010 statistics were inflated by the federal homebuyer tax-credit. "As for market activity, the pace of sales for the first three months of this year is in line with our expectations for all of 2011," said Leslie Appleton-Young, vice president and chief economist at CAR. DataQuick reported the median sale price at $249,000 for March. The median sale price for a single-family home in the Los Angeles metropolitan area was $272,600 in March and in the San Francisco Bay area the median price was $487,060. Those are down 2.7% and 2.4%, respectively, from March 2010. Write to Christine Ricciardi. Follow her on Twitter @HWnewbieCR.