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California home sales decline in February, as buyers stay in the sidelines

Wednesday, March 23, 2011

California home sales declined in February following three months of sales gains, according to the California Association of REALTORS®. The state Realtor group also reports the statewide median price of an existing, single-family detached home also declined last month.

According to information collected by the state REALTOR® association, closed escrow sales of existing, single-family detached homes in California totaled 497,660 in February, down 9 percent from January's revised pace and down 4 percent from the sales pace recorded in February 2010. The median number of days it took to sell a single-family home was 64.4 days in February 2011, compared with 39.2 days for the same period a year ago.

"With continued concerns about the economy and housing market, consumers remain tentative moving forward with any home buying plans," said California Association of REALTORS® president Beth L. Peerce. "Nevertheless, current market conditions and loan rates at some of the lowest of all time continue to present attractive opportunities to those who are in a position to buy."

The statewide median price of an existing, single-family detached home sold in California was $271,320, down 2.8 percent from January's median and down 2.5 percent from the median price recorded for February 2010. 

Thirty-year fixed-mortgage interest rates averaged 4.95 percent during February 2011, compared with 4.99 percent in February 2010, according to Freddie Mac. Adjustable-mortgage interest rates averaged 3.35 percent in February 2011, compared with 4.23 percent in February 2010.
Santa Clara County saw its share of sales and median price decline. The state REALTOR® group's data shows February sales of existing single-family homes in the county were down 0.8 percent from last month and down 0.5 percent from the same time last year. The median price of an existing single-family home in February was $525,250, down 0.9 percent from the January median of $530,000, and down 4.5 percent from $550,000, the median price in February 2010.

"We are receiving much interest from buyers, but they continue to hesitate, even if home prices have come down and rates continue to remain low," said Gene Lentz, president of the Silicon Valley Association of REALTORS®.   "It's the best time to buy a home if you can afford to do so, but uncertainty about the economy contributes much to buyer hesitancy. I'm sure troubling events around the world and rising gas prices have contributed to this uncertainty also."

The state figure mirrors the trend nationwide trend. The National Association of REALTORS®. reports single-family home sales in February fell 9.6 percent from January, and are 2.7 percent below the February 2010 pace. The median existing single-family home price was $157,000 in February, down 4.2 percent from a year ago.

Cash buyers continue to dominate the market. DataQuick Information Systems reports buyers who paid all cash accounted for a record 30.9 percent of February sales in the Bay Area, the highest for any month since January 1988, when the real estate information service began collecting this data. Last month's cash level was up from 28.7 percent in January and 27.3 percent a year ago. Since 1988, the monthly average for cash buyers is 11.6 percent.

Lentz also attributed buyer hesitance to tight credit. "They say jumbo loans are loosening, but not enough, it seems. We hope there will be some improvement this spring season," said Lentz.

DataQuick reports jumbo loans, mortgages above the old conforming limit of $417,000, accounted for 26.8 percent of last month's purchase lending in the nine-county Bay Area, down from 26.9 percent in January, but up from 26.6 percent in February 2010. Before the August 2007 credit crunch, jumbos accounted for nearly 60 percent of the Bay Area purchase loan market.



The Silicon Valley Association of REALTORS® (SILVAR) is a professional trade organization representing over 4,000 REALTORS® and Affiliate members engaged in the real estate business on the Peninsula and in the South Bay. SILVAR promotes the highest ethical standards of real estate practice, serves as an advocate for homeownership and homeowners, and represents the interests of property owners in Silicon Valley.

The term "REALTOR®" is a registered collective membership mark which identifies a real estate professional who is a member of the National Association of REALTORS® and who subscribes to its strict Code of Ethics.

Variations of this article have appeared in local area newspapers.

For further information, please contact Rose Meily at SILVAR Public Affairs, email , or phone (408) 200-0109.

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