C.A.R. Reports Sales Increased 56.7 Percent; Median Home Price Fell 40.5 Percent in August

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RISMEDIA, September 29, 2008-Home sales increased 56.7 percent in August in California compared with the same period a year ago, while the median price of an existing home fell 40.5 percent, the California Association of Realtors® (C.A.R.) reported Friday.

“Sales are now 85 percent above the monthly trough for this cycle, which occurred in October 2007, and for the first time this year are ahead of 2007 in year-to-date terms,” said C.A.R. President William E. Brown.

“While this is encouraging news, we don’t expect to see a housing market recovery until prices stabilize and the number of distressed properties on the market declines,” Brown said. “Sales gains continue to be driven by the large share of deeply-discounted distressed sales in many parts of the state.”

Closed escrow sales of existing, single-family detached homes in California totaled 490,850 in August 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 increased 56.7 percent from the revised 313,310 sales pace recorded in August 2007. Sales in August 2008 increased 1.8 percent compared with the previous month.

The statewide sales figure represents what the total number of homes sold during 2008 would be if sales maintained the August pace throughout the year. It is adjusted to account for seasonal factors that typically influence home sales.

The median price of an existing, single-family detached home in California during August 2008 was $350,140, a 40.5 percent decrease from the revised $588,670 median for August 2007, C.A.R. reported. The August 2008 median price fell 0.2 percent compared with July’s revised $350,890 median price.

“Although the month-to-month decline in the median price was the smallest in a year, it’s still premature to say that the median price has begun to stabilize,” said C.A.R. Vice President and Chief Economist Leslie Appleton-Young.

“While sales appear to have turned the corner, the median will experience additional downward pressure as we move into the off-peak season in the coming months, and will continue to face pressure from distressed sales,” she said. “Sales are just one of the variables that must fall into place before we see real improvement in the market.”

Highlights of C.A.R.’s resale housing figures for August 2008:

- C.A.R.’s Unsold Inventory Index for existing, single-family detached homes in August 2008 was 6.7 months, compared with 10.6 months (revised) for the same period a year ago. The index indicates the number of months needed to deplete the supply of homes on the market at the current sales rate.

- Thirty-year fixed-mortgage interest rates averaged 6.48 percent during August 2008, compared with 6.57 percent in August 2007, according to Freddie Mac. Adjustable-mortgage interest rates averaged 5.26 percent in August 2008, compared with 5.67 percent in August 2007.

- The median number of days it took to sell a single-family home was 47.3 days in August 2008, compared with 54.7 days (revised) for the same period a year ago.

Regional MLS sales and price information are contained in the tables that accompany this press release. Regional sales data are not adjusted to account for seasonal factors that can influence home sales. The MLS median price and sales data for detached homes are generated from a survey of more than 90 associations of Realtors throughout the state. MLS median price and sales data for condominiums are based on a survey of more than 60 associations. The median price for both detached homes and condominiums represents closed escrow sales.

In a separate report covering more localized statistics generated by C.A.R. and DataQuick Information Systems, 1.1 percent, or 4 out of 366 cities and communities, showed an increase in their respective median home prices from a year ago. DataQuick statistics are based on county records data rather than MLS information. DataQuick Information Systems is a subsidiary of Vancouver-based MacDonald Dettwiler and Associates. (The top 10 lists are generated for incorporated cities with a minimum of 30 recorded sales in the month.)

Note: Large changes in local median home prices typically indicate both local home price appreciation, and often, large shifts in the composition of housing market activity. Some of the variations in median home prices for July may be exaggerated due to compositional changes in housing demand. The DataQuick tables listing median home prices in California cities and counties are accessible through C.A.R. Online at http://car.org:/economics/historicalprices/2008medianprices/aug2008medianprices/

- Statewide, the 10 cities with the highest median home prices in California during August 2008 were: Newport Beach, $1,400,000; Los Gatos, $1,225,000; Burlingame, $1,210,000; Manhattan Beach, $1,190,000; Cupertino, $1,153,000; Santa Barbara, $1,000,000; Santa Monica, $985,000; San Carlos $900,000; Danville, $885,000; Mountain View, $885,000; and San Clemente, $784,500.

- Statewide, the cities with the greatest median home price increases in August 2008 compared with the same period a year ago were: Mountain View, 17 percent; Cupertino, 5.5 percent; Santa Monica, 1.3 percent; and Alhambra 0.4 percent.

For more information visit www.car.org.

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