California's spring housing market is off to a strong start. Every major region in the state posted healthy gains in March for sales and median price on an annual and monthly basis.
The California Association of Realtors reports closed escrow sales of existing, single-family detached homes in March totaled a 416,580 units. The March figure was up 4 percent from the 400,720 level in February and up 6.9 percent compared with 389,770 home sales in March 2016.
"March's solid sales performance was likely influenced by the specter of higher interest rates, which may have pushed buyers off the sidelines and close escrow before rates moved higher," said California Association of Realtors president Geoff McIntosh.
March's statewide median home price was $517,020, up 8 percent from February's median of $478,570. The March median was 6.8 percent higher than the median of $517,020 March 2016 median of $517,020.
"The spring homebuying season is off to a good start, as the economic and market fundamentals remain solid for the most part," said Leslie Appleton-Young, the state Realtor group's senior vice president and chief economist. "However, higher interest rates, a dearth of housing inventory, and slow wage growth will continue to have an adverse effect on housing affordability that is putting upward pressure on home prices, and is sure to hamper the market throughout the year."
The San Francisco Bay Area experienced a healthy annual sales gain of 6.4 percent and monthly sales gain of 62.7 percent. In Santa Clara County, annual home sales were 11.6 percent more than in March 2016 and gained 57.2 percent month to month.
The median sales price for a Santa Clara County single-family home in March was $1,130,000, up 2.7 percent from February's median of $1,100,000 and 6.1 percent higher than the March 2016 median of $1,065,000.
"As companies continue to expand their workforce, the demand for homes in Silicon Valley remains strong. Anticipating mortgage interest rates will continue in an upward direction, would- be buyers are feeling the pressure to purchase a home before affordability gets worse," said Denise Welsh, president of the Silicon Valley Association of Realtors.
The March housing report indicates the Unsold Inventory Index, which measures the number of months needed to sell the supply of homes on the market at the current sales rate, dropped a full month to 3.0 months in March from 4.0 months in February. The index stood at 3.6 months in March 2016.
In Santa Clara County, the index dropped to 2.0 in March from 2.5 in February and 2.6 March last year. The median number of days it took to sell a Santa Clara County single-family home fell from 33.5 days in February to 26.7 days in March and was down from 29.9 days in March 2016.
"It's tricky maneuvering the current housing market alone, whether buying or selling a home. A knowledgeable Realtor has the expertise and the resources to assure a smooth and successful transaction," added Welsh.
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.