California existing home sales fell from the previous year in April as tight housing inventory continued to impede the housing market, according to the California Association of REALTORS® (C.A.R.). State REALTOR® officials say April marked the second worst start to a spring home buying season since the housing recovery began in 2009.
C.A.R. reports closed escrow sales of existing, single-family detached homes in California totaled 406,800 units in April, down 2.6 percent from the revised 417,580 units sold in March and down 5.4 percent compared with home sales in April 2015. The year-to-year decline was the first in five months and the largest sales drop since August 2014.
"The statewide median home price rising above $500,000 for the first time in nine years will undoubtedly exacerbate housing affordability for California home buyers," said C.A.R. president Pat "Ziggy" Zicarelli.
Zicarelli noted as home prices continue their upward trend, especially in high-cost, major metropolitan regions, home buyers looking to maximize their housing dollars are moving to farther outlying regions. "Bay Area buyers who were previously seeking homes in areas adjacent to San Francisco, such as Solano and Sonoma counties, now are looking even further in Sacramento, Stanislaus, and San Joaquin counties, as Bay Area adjacent counties become less affordable," said Zicarelli.
An imbalance between supply and demand pushed the median price of an existing, single-family detached California home 5.3 percent higher in April to $509,100 from $483,280 in March. April's median price was 5.1 percent higher than the $484,370 median in April 2015. April marked the first time in nine years that the median price has risen above the $500,000 level, though it is still below the pre-recession peak of $594,530 reached in May 2007.
"Thin housing supplies were the driving force behind April's sales drop with the most inventory constrained markets feeling the largest declines," said Leslie Appleton-Young, C.A.R. vice president and chief economist. "As home buyers continue to move inland to find affordable housing, inventory will eventually be depleted, putting upward pressure on home prices."
In Santa Clara County, the median price of a single-family home was $1,085,000 in April, up 1.9 percent from the March median of $1,065,000 and up 13 percent from the April 2015 median of $960,000. Sales of single-family homes in the county were up 30.6 percent from the previous month and down 12.6 percent from April 2015. Inventory was at 2.1 months in April, compared with 2.4 months in March and 1.6 months in April 2015. A six- to seven-month supply is considered normal for the state.
"We are seeing an acute shortage of housing in our region. The repercussion is that good people are moving to outlying areas and then traveling for hours just to get to their jobs. The only apparent solution to this serious problem is building more local housing," said Karen Trolan, president of the Silicon Valley Association of REALTORS®.
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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