The rate of sales for single-family, detached resale homes plummeted 40.2 percent in California in October compared to the same month last year, while the median price dropped 9.9 percent the California Association of Realtors trade group reported Wednesday.
And the California Building Industry Association reported that total housing starts in the state fell 30.9 percent from January through October in California compared to the same period last year.
Leslie Appleton-Young, chief economist for the association, said in a statement, “We expect further weakness in sales over the next few months as the liquidity crisis plays out.”
The group’s Unsold Inventory Index was 16.3 months in October, indicating that it would take an estimated 16.3 months to exhaust the supply of for-sale homes at the October sales pace. The index stood at 6.4 months in October 2006.
A for-sale inventory of about six months is considered to indicate a market that is roughly in equilibrium, with a supply greater than six months generally indicating a buyer’s market.
“Financing issues have dogged entry-level buyers since early 2007, but they spilled over into the middle- and upper-tier markets in the last few months,” said William E. Brown, president for the Realtors group.
“The decline in sales at the upper end of the market contributed to a significant decline in the statewide median price as even well-qualified borrowers had difficulty securing financing.”
The seasonally adjusted annualized sales rate for existing, single-family detached homes totaled 265,030 in October — this rate is a projection of a monthly sales total over a 12-month period, adjusted for seasonal fluctuations in sales activity. That compares to a sales rate of 443,320 in October 2006.
The median price of an existing, single-family detached home in California was $497,110 in October, down 9.9 percent from the revised $552,020 median price in October 2006. The median statewide condo price dropped 2.1 percent.
It took a median 59.3 days to sell a single-family home in October 2007, compared with 56.5 days in October 2006, the Realtor group reported.
Freddie Mac reported that 30-year fixed-mortgage interest rates averaged 6.38 percent in October 2007, compared with 6.36 percent in October 2006, and adjustable-mortgage interest rates averaged 5.68 percent in October 2007 compared with 5.56 percent in October 2006.
Home prices for all housing types decreased in about 86 percent of the 296 cities and communities tracked in a separate report prepared by the association and real estate research company DataQuick Information Systems.
The 10 cities and communities with the highest median home prices in California during October 2007 were Newport Beach, at $1,575,000; Santa Barbara, $1,275,000; Cupertino, $1,033,000; Danville, $1,017,500; Los Gatos, $1,005,000; San Carlos, $927,500; Redwood City, $912,000; San Ramon, $835,000; San Clemente, $832,500; and San Mateo, $829,500.
The 10 cities and communities with the greatest median-home-price increases in October 2007 compared to October 2006 were Santa Barbara, 24.4 percent; Arcadia, 21.3 percent; Redwood City, 20.6 percent; Newport Beach, 18.4 percent; San Ramon, 14.4 percent; Cupertino, 11.7 percent; San Carlos, 9.5 percent; Redlands, 8.8 percent; Redondo Beach, 8.7 percent; and Sunnyvale, 7.6 percent.
The 10 cities, city areas and communities with the greatest median home price decreases in October 2007 compared to 2006 were Palm Springs, down 64.6 percent; Los Banos, down 27.7 percent; Elk Grove, down 27 percent; Galt and Stockton, down 26.1 percent; Antioch, down 25.3 percent; Merced, down 25.1 percent; Salinas, down 25 percent; and Walnut Creek and Wildomar, both down 24.9 percent.
San Benito County had the largest drop in home prices from October 2006 to October 2007, falling 27.5 percent; followed by Merced County, down 26.7 percent; Monterey County, down 23 percent; San Joaquin County, down 19 percent; and Madera County, down 17.1 percent.
The three counties tracked in the report that experienced house-price appreciation in October 2007 compared to October 2006 are San Mateo County, up 4.7 percent; San Francisco County, up 2.9 percent; and Santa Clara County, up 2.2 percent.
The California Building Industry Association, in a separate announcement on Wednesday, reported that housing starts, as measured by building permits issued, dropped 28 percent in October compared to October 2006. There were 7,726 building permits issued for housing units in the state in October, according to the report.
The Riverside-San Bernardino-Ontario, Calif., market area had the steepest year-over-year drop in building permits from January through October this year compared to the same period last year among markets with 200 or more permits issued.
Housing starts, as measured by building permits issued, dropped 46.3 percent in that market area from January through October this year compared to the same period last year, while falling 39.3 percent in the Bakersfield and Oakland areas, 35.1 percent in the San Diego area, 30.1 percent in the Sacramento area, 27.9 percent in Stockton, 23.5 percent in Modest, 20 percent in Los Angeles, 17.2 percent in Visalia-Porterville, 16 percent in Santa Ana-Anaheim-Irvine, and rising 5.6 percent in Fresno.
Housing starts fell 56.4 percent from October 2006 to October 2007 in Bakersfield — the steepest drop among markets with 200 or more permits issued in October.
Next on the list was Oakland, with a 48 percent drop; followed by Riverside, with a 43 percent drop; San Diego, down 41.1 percent; Sacramento, down 34.4 percent; Visalia, down 33.7 percent; and Los Angeles, down 32.3 percent. Anaheim was up 9.2 percent, followed by Fresno, up 13.7 percent; Stockton, up 59.6 percent; and Modesto, up 128 percent.
Single-family housing starts dropped 40.7 percent in October compared to October 2006, while multifamily starts dropped 10.3 percent.
Single-family starts dropped 36.4 percent during the first 10 months of 2007 compared to the same period last year, while multi-family starts are down 19.8 percent.
“Most areas saw modest losses in the multifamily sector, with very few experiencing the type of drop-offs evident in the single-family sector,” said Alan Nevin, chief economist for the builders’ group, in a statement.
He noted that much of the decline in the production of single-family homes this year has occurred in the Inland Empire, San Joaquin Valley and Sacramento areas.
The CBIA report is based on data from the Construction Industry Research Board, a nonprofit research center.
Resale Home Price and Sales Report for October 2007*
*Based on closed escrow sales of single-family, detached homes only (no condos).
Source: California Association of Realtors
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