The California Association of REALTORS® reported December home sales decreased 33.4 percent in California compared with the same period a year ago, while the median price of an existing home fell 16.5 percent. Santa Clara County fared better than other counties in the state, experiencing the smallest median home price decline - 0.7 percent compared with the same period last year.
"December is typically one of the slower months for sales, and the liquidity crunch continued to dampen sales beyond the normal seasonal decrease," said C.A.R. President William E. Brown. "The liquidity crunch also contributed to the significant decline in the median price due to the lack of financing options for loans above the conforming loan limit of $417,000."
Brown added, "It is imperative that the proposed increase to conforming loan limits that is part of the economic stimulus package receive swift approval by both houses of Congress."
Members of the Silicon Valley Association of REALTORS®, the local trade organization representing over 4,000 REALTORS® and affiliate members engaged in the real estate business on the Peninsula and in the South Bay, along with C.A.R., and the National Association of REALTORS® have urged Congress to increase conforming loan limits in order to help homeowners nationwide.
Closed escrow sales of existing, single-family detached homes in California totaled 301,040 in December at a seasonally adjusted annualized rate, according to information collected by C.A.R. from more than 90 local REALTOR® associations statewide. Statewide home resale activity was down 33.4 percent from the 452,060 sales pace recorded in December 2006.
The median price of an existing, single-family detached home in the state during December 2007 was $475,460, a 16.5 percent decrease from the revised $569,350 median for December 2006.
"It will take some time for the Federal Reserve Bank's recent reduction of the federal funds rate to have an effect on the housing market, but should result in more favorable real estate finance rates as we move through the year," said C.A.R. Vice President and Chief Economist Leslie Appleton-Young." Jumbo loan financing remains a serious problem. Just under half of the California market relies on jumbo loans, but funds are limited — because of the liquidity crunch — and the rate spread between jumbos and conforming loans is three to four times greater than normal."
In Santa Clara County, the median price of all types of homes – new and existing, condos and single-family in December 2007 was $664,000, down slightly from $668,500 from the prior year. Prices appear to be holding in Los Gatos, Mountain View and Sunnyvale, cities which actually saw a median home price increase from a year ago. The median price in Los Gatos was $1,400,000, up 44.3 percent; Mountain View, $730,000, up 14.1 percent; and Sunnyvale, $706,000, up 2.5 percent.
Statewide, the 10 cities and communities with the highest median home prices in California during December 2007 were: Burlingame, $1,590,000; Los Gatos, $1,400,000; San Juan Capistrano, $1,125,000; San Clemente, $1,007,000; Santa Monica, $950,000; Danville, $949,000; Encinitas $900,000; Redwood City, $837,500; Santa Barbara, $835,000; and San Ramon, $750,500.
Statewide, the 10 cities and communities with the greatest median home price increases in December 2007 compared with the same period a year ago were: Los Gatos, 44.3 percent; Encinitas, 23.8 percent; Burlingame, 20 percent; Chino Hills, 16.4 percent; Mountain View, 14.1 percent; Redwood City, 10.9 percent; San Clemente, 9.9 percent; Moorpark, 7.2 percent; Santa Cruz, 5 percent; and South Lake Tahoe, 4.8 percent.
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.