California's housing market dropped below the 400,000-level sales benchmark in January, the first time since March 2016, as sales declined on both a monthly and annual basis. The month-to-month decline was also the largest in more than two years, according to the California Association of Realtors.
Information collected by C.A.R. from local Realtor associations and MLSs statewide shows closed sales of existing, single-family detached homes in California totaled 388,800 units in January, down 7.6 percent from the 420,960 in December and down 2.9 percent from 400,580 home sales in January 2017.
"A persistent shortage of housing inventory and continued affordability crunch is beginning to eat away at the market as buyers struggle to find available homes for sale," said C.A.R. president Steve White. "As such, we're seeing a shift in sales toward inland areas such as San Bernardino County in Southern California, and Placer, San Joaquin, Sacramento, and Stanislaus counties, which are all adjacent to the inventory- and price-challenged San Francisco Bay Area."
January's statewide median price of $527,800 was down 4 percent from the December median of $549,560 and was 7.3 percent higher than the revised January 2017 median of $491,840. The year-over-year price gain has been growing at or above 7 percent for seven of the past eight months.
Silicon Valley continues to be the state's least affordable housing market, with the highest prices and the lowest levels of unsold inventory. Sales in both Santa Clara and San Mateo counties declined on both a monthly and annual basis.
Year-over-year sales in Santa Clara County dropped 4.5 percent and month-over-month sales fell 35.6 percent. The January median of $1,170,000 in Santa Clara County was 10 percent lower than the December 2017 median of $1,300,000, and 26.1 percent higher than the January 2017 median of $927,500.
January homes sales in San Mateo County fell 9.5 percent from January 2017 and were down a woeful 46.1 percent from December 2017. The January median of $1,437,500 was 4.2 percent lower than in December 2017 median of $1,300,000, and 25 percent higher than the January 2017 median of $1,150,000.
"The most affordable 20 percent of the market now has a median price of $220,000 in the state, up more than 10 percent from a year ago, when an entry-level home averaged $200,000," said Bill Moody, president of the Silicon Valley Association of Realtors. "In Silicon Valley, where the median has increased in a year's time by over 25 percent, affordability is eroding quickly even for high-income earners in the region."
Moody added, "With 30-year fixed-mortgage interest rates still low, averaging 4.03 percent, Realtors are reporting multiple offers and bidding wars, especially for homespriced in the $1.5 million-$2 million range. Homes for sale are staying on the market a mere nine days in Santa Clara County and 12 days in San Mateo County, the shortest time in the state."
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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