It has been reported that nationwide home sales eased 0.8 percent in June, but in the state of California, the housing market picture appears brighter. June home sales rose and the median price increased to its highest level since December 2010, according to a California Association of REALTORS® report. Future prospects look good too, as June pending sales rose for the second consecutive month.
Closed sales of existing, single-family detached homes in the state rose 1.2 percent from May to 477,710 units in June, according to information collected by the state trade association from more than 90 local REALTORS® associations and MLSs statewide. June home sales were down 3.6 percent from the same time last year. The statewide median price of an existing, single-family detached home sold in California rose 1 percent in June to $295,300 from a revised $292,420 in May. June's median price was down 5.9 percent from the $313,890 median in June 2010.
"Looking across the state, a number of areas are showing signs of strength, especially in the San Francisco Bay Area, primarily because of the strong performing tech industry," said C.A.R. vice president and chief economist Leslie Appleton-Young. "Alameda, Contra Costa, Marin, San Francisco, and Santa Clara counties all posted solid sales and price gains from May levels."
Santa Clara County showed a rise in both home sales and median price from the previous month and year. Sales of existing single-family detached homes in the county were up 15 percent from May and 0.8 percent from June 2010. The median price also showed improvement in comparison to the previous month and year. The June median price for an existing single-family detached home in Santa Clara County was $635,000, up from $600,000 in May and $633,000 in June 2010.
C.A.R.'s Pending Home Sales Index was 119 in June, an increase of 1.9 percent from May's index of 116.8, based on contracts signed in June. The index also was up 4.4 percent from June 2010. Pending home sales are forward-looking indicators of future home sales activity, providing information on the future direction of the market. With the increase in June, the next few months should bring continued gains, according to real estate officials.
Much depends on the direction of the economy in the next few months, according to Silicon Valley Association of REALTORS® president Gene Lentz. Lentz added there continues to be growing concern in the industry as conforming loan limits are scheduled to drop on September 30. "If conforming loan limits on mortgages backed by the Federal Housing Administration, Fannie Mae, and Freddie Mac are reduced beginning October 1, potential buyers, especially those looking for a home in the mid to upper price ranges, will face higher down payments, higher mortgage rates, and stricter loan qualification requirements. It will affect the Silicon Valley housing market."
Congress temporarily raised the conforming loan limits from $417,000 to $729,750 and extended the loan limits each year through fiscal year 2011. The Realtors are urging Congress to grant make the current conforming loan limits permanent.
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.
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