Pending home sales rose from December's extreme lows. The California Association of REALTORS® said Wednesday that pending home sales posted month-to-month and year-to-year increases in January. There are, however, fewer multiple offers and more homes sold below asking price, pointing to a less competitive buyers' market.
C.A.R.'s Pending Home Sales Index rose 26.7 percent from 70.9 in December to 89.8 in January, based on signed contracts. The month-to-month increase was better than the long-run average increase of 16.3 percent in the last six years. C.A.R. attributes this primarily to seasonal factors. California pending home sales were up 6 percent from the 84.7 index recorded in January 2014. The yearly increase was the largest since May 2012.
"Pending home sales are forward-looking indicators of future home sales activity. December has traditionally been a slower month for sales due to the holiday season and weather. We will likely see more activity in the market as we move forward to spring," said Chris Isaacson, president of the Silicon Valley Association of Realtors.
According to C.A.R.'s January Market Pulse Survey, a monthly online survey that measures California REALTORS®' sentiment about their last closed transaction and business activity for the previous month and the last year, California REALTORS® saw more price reductions and fewer multiple offers, compared to a year ago.
Only 16 percent of homes sold above asking price in January, down from a peak of 40 percent in March 2014. The share is also down from 25 percent in December and 27 percent in January 2014. More than half of homes (55 percent) are closing below asking price, up from 51 percent in December 2014. Homes that sold below asking price in January sold for 11 percent below asking price.
Meanwhile, 58 percent of properties received multiple offers in January, down from 61 percent in December 2014 and 64 percent in January last year. The average number of offers per property in January was 2.5, down from 2.6 in December 2014 and 3.1 a year ago.
While floor calls, listing appointments, open house traffic, multiple offers, and all-cash purchases were down from December 2014, REALTORS® indicated open house traffic was up from January a year ago.
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.
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