California pending home sales declined in August but remained strong, marking 10 straight months of year-over-year gains, according to the latest report from the California Association of REALTORS®. In a separate report, California REALTORS® responding to the state REALTOR® group's August Market Pulse Survey saw a drop in sales with multiple offers compared with the previous month.
The statewide Pending Home Sales Index (PHSI) rose 12.8 percent to 112.8 in August, based on signed contracts. The August 2015 index was up from the 100 index recorded a year ago and marked the 10th straight month of year-to-year gains and the seventh straight month of double-digit advances. Meanwhile, statewide pending home sales in August fell 8.7 percent on a month-to-month basis down from the 123.6 index in July.
At the regional level, pending sales were higher on a year-over-year basis in the San Francisco Bay Area, Southern California and Central Valley, but month-to-month comparisons were lower. Pending sales in the San Francisco Bay Area fell 14.1 percent from July to an index of 119.7, but were up 1.1 percent from August last year.
"With school starting and the fall season coming, we are headed toward the end of the peak home buying season, which is typically when market competition cools down," said Chris Isaacson, president of the Silicon Valley Association of REALTORS®.
Findings from the state REALTOR® association's August Market Pulse Survey show the share of sales closing below asking price increased to 48 percent in August. More than one-fourth of homes (27 percent) closed above asking price, and 25 percent closed at asking price.
For the one in four homes that sold above asking price, the premium paid over asking price dropped to an average of 8.2 percent, from 11 percent in July and 8.4 percent in August 2014. The 48 percent of homes that sold below asking price sold for an average of 11 percent below asking price in August, up from 9.6 percent in July.
The share of properties receiving multiple offers decreased in August to 58 percent, down from 67 percent in July and 61 percent in August 2014. The average number of offers per property dipped to 2.4 from 3.0 in July and 2.5 in August 2014.
When asked their biggest concerns, 22 percent of REALTORS® who responded said low housing affordability, 18 percent said overinflated home prices, and another 18 percent are concerned with a shortage of available homes for sale.
"These are very real concerns facing the San Francisco Bay Area right now. They are subjects most talked about at meetings and even social gatherings," said Isaacson. "The state is in need of more housing to meet demand."
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.