California existing home sales and median home price saw increases on both a monthly and an annual basis in August, seemingly unfazed by the market's tight inventory. Days on market are tightening, as well.
The California Association of Realtors reports sales of existing, single-family homes in August totaled 427,630 units, up 1.5 percent from July. Home sales were 1.3 percent higher compared with sales in August 2016.
"While August's strong housing market performance is encouraging, it's really a tale of two markets. Despite sales growth across all segments of the market, lower-priced homes are particularly inventory constrained, which leads to weaker sales growth, faster rising prices, and fierce competition for the few homes that are listed," said Geoff McIntosh, president of the California Association of Realtors.
The median price rose 2.9 percent from $549,460 in July to $565,330 in August. The median was 7.2 percent higher from the revised $527,490 median in August 2016.
"August marked the third straight month that the median price gained 7 percent or more year-over-year, indicating that prices are not only growing, but are accelerating into the end of the year," said Leslie-Appleton-Young, senior vice president and chief economist of the state Realtor group. "For the most inventory constrained segment of the market - the bottom 20 percentile - home prices rose even higher with a double-digit gain (10.7 percent)."
According to MLSListings, the multiple listing service provider of the Silicon Valley Association of Realtors, Santa Clara County's year-over-year closed sales and median sale price improved by 10 percent and 18 percent respectively, while inventory and days on market showed marked decreases of 46 percent and 35 percent, respectively.
MLSListings reports Santa Clara County's median price of a single-family home in August 2017 was $1,150,000, up 18 percent from the August 2016 median of $975,000 and 1 percent lower than the July 2017 median of $1,165,000.
The August 2017 inventory of 925 homes was the lowest level recorded for that month since 2000, and was 46 percent lower than August last year. New listings in August were also historically low at 1,000 listings, and a 10 percent decrease from August 2016.
In contrast, month-over-month closed sales, while down slightly from July, from 1,061 to 1,013, showed a 10 percent increase from 924 sales in August 2016 to 1,013 sales in August 2017.
Lower inventory, more closed sales, and slightly lower pricing meant even fewer days on market. On average, homes stayed on the market 20 days, a 9 percent decrease from July and a 35 percent drop over August 2016.
"The resale market is challenging. There are still multiple offers in the more affordable price ranges, and it is a struggle, particularly for the first-time homebuyers," said Denise Welsh, president of Silicon Valley Association of Realtors. "In Silicon Valley, much of the new construction is rental housing, so that market seems to be softening a bit."
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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