Sales were on the upswing in California in April, signaling the start of a strong spring market. The California Association of REALTORS® (C.A.R.) reported this week that the state's home sales and median price both jumped in April, with sales shooting up to their highest level in more than two years, and the median price rising above $300,000 for the first time in 16 months.
"A brighter economic picture, coupled with record-high housing affordability, pushed the spring home buying season off to a strong start," said C.A.R. president LeFrancis Arnold. "With a continuing improving economy and interest rates declining to new record lows in recent weeks, we should see a steady improvement in the housing market throughout the end of the year."
According to information collected by C.A.R. from more than 90 local REALTOR® associations and MLSs statewide, closed escrow sales of existing, single-family detached homes in the state rose to 555,300 units in April, 10 percent higher than March's pace and 11 percent higher than in April 2011.
The statewide median price of an existing, single-family detached home climbed 5.7 percent in April to $308,050, up from March's revised $291,330 median price and 4.7 percent from a revised $294,140 recorded in April 2011. The median price rose above the $300,000 mark for the first time since December 2010.
California's housing inventory remains low, however. "The strong sales increase of higher-priced homes resulted in a considerable decline of inventory of homes in the higher price ranges when compared with last year," said C.A.R. vice president and chief economist Leslie Appleton-Young. "This signifies the tight supply conditions we've been experiencing in the lower price ranges over the past several months are now extending into the upper price ranges."
The Unsold Inventory Index for existing, single-family detached homes remaining at 4.2 months in April, unchanged from a revised 4.2 months in March. April's housing inventory was down from a revised 5.6 months in April 2011. The index indicates the number of months needed to sell the supply of homes on the market at the current sales rate. A 7-month supply is considered normal. The median number of days it took to sell a single-family home fell to 49.3 days in April 2012, down from a revised 53.2 days for the same period a year ago.
The Silicon Valley region is especially experiencing low inventory. Some sellers appear to be waiting to sell in anticipation of Facebook's IPO, according to REALTORS®. "The housing market is really favorable for buyers right now with the record affordability due to record-low interest rates and stable prices, but inventory is a big problem in our region," said Suzanne Yost, president of the Silicon Valley Association of REALTORS®. "With the Facebook IPO, those ready to sell are willing to wait and see if they can demand an even higher price for their home once the company's employees receive their money. Prices in the area have already increased substantially from last year."
According to MLSListings Inc., the multiple listing service of the local trade association, the average days on market of a single-family home in Palo Alto dropped to 14 in April, down from 18 days in March and 35 days in April of 2011. There were 41 single-family homes on inventory in the month of April in Palo Alto, 37 in March and 70 in April of 2011. The median sales price of a Palo Alto home was $ 2,025,500 in April, up substantially from $1,650,000 in April 2011.
According to C.A.R., the median price of a single-family home in Santa Clara County rose 10.6 percent to $636,000 in April from the median of $575,250 in March and up 10 percent from the median of $578,000 in April 2011. Home sales in April were up 6.6 percent from March sales, but down 3 percent from the previous year.
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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