A recent California Association of REALTORS® (C.A.R.) report reveals a slight drop in home sales in the month of February, but there are some gains in inventory. Hot markets like Silicon Valley continue to see increases in sales and median price, and an upward trend in the supply of homes for sale.
Statewide sales of single-family detached homes dropped 0.7 percent in February from January sales of 363,930 units and were 13.7 percent below units sold in February of last year. According to C.A.R., last month marked the fourth straight month that sales were below the 400,000 level and the seventh straight decline on a year-over-year basis.
"The slower sales in February reflects diminished housing affordability after three years of solid price increases and interest rates that are nearly a full percentage point higher than a year ago," explained C.A.R. president Kevin Brown.
The California median price of an existing, single-family detached home in February was $404,250, down 1.6 percent from January's median price of $410,990 but 21.3 percent higher than $333,180, the revised median in February 2013.
"Supply conditions in the housing market have shown some improvement since the end of last year, except for the lowest price range where the inventory for distressed properties is depleted. In the mid-priced range of $300,000-$750,000, which covers nearly half of all home sales, inventory is up 27 percent, while the supply of high-end homes – properties priced at or above $1 million, also is up 13 percent from a year ago," said C.A.R. vice president and chief economist Leslie Appleton-Young.
David Tonna, president of the Silicon Valley Association of REALTORS® (SILVAR), said the improvement in the supply of homes priced above the distressed property range will loosen inventory as there are sellers looking to be trade-up buyers. "We have sellers who believe this is a good time to sell, but ask where they would go since inventory has been so tight. We could see more activity among this sector of buyers this spring," said Tonna.
The market's performance in Silicon Valley continues to beat other parts of the state. In Santa Clara County, February home sales were up 7.1 percent from the previous month, but down 9.2 percent from February 2013. The February median of $801,000 was up 9.6 percent from the January median of $731,000 and 12.8 percent higher than the February 2013 median of $710,000.
In San Mateo County sales were down 13.1 percent month-to-month and down 17.4 percent year-to-year. The median sales price of $965,000 was up 2.3 percent month-to-month and 20.6 percent higher than the February 2013 median of $800,000.
According to MLSListings Inc. there were 1,186 single-family homes in Santa Clara County on current inventory in February 2014, up from 1,083 in January. Inventory was at 1,360 in February 2013. San Mateo County had 552 single-family homes on inventory in February, 464 in January, and 660 in February 2013.
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 email or call the SILVAR office at (408) 200-0100.