Key Highlights
- California home sales in July reached highest level in +2.5 years
- Statewide median home price jumped +9.6% y/y to $666,320, according to California Association of Realtors
Dreams of living in the Golden State returned in July. Rather than fleeing the state for more space and affordability inland, existing single-family home sales in California soared +28.8% m/m and +6.4% y/y.
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California Association of Realtors (CAR) 2020 President Jeanne Radsick said, “A housing market trifecta of strong pent-up demand, record-low interest rates and a renewed interest in the value of homeownership bolstered July’s home sales. With this year’s delayed start of the home buying season due to the pandemic, we expect home sales to remain robust in August and September, extending the season later than what’s typical.”
In addition to single-family home sales significantly increasing in July, statewide median home prices were $666,320, an increase of +9.6% y/y. Home prices along the Central Coast of California and the San Francisco Bay Area jumped even more to +10%.
CAR’s senior vice president and chief economist Leslie Appleton-Young said, “Stronger sales of higher-priced properties continue to propel the statewide median home price, as those who tend to purchase more expensive homes are less impacted by the economic recession.” On top of that, Appleton-Young added, “High demand in resort communities is another variable that’s fueling the increase in home prices, as a new wave of remote workers are leaving cities in search of more space and a healthier lifestyle in what use to be the second/vacation home market.”
California is already and will continue to benefit from a substantial increase in the National Association of Home Builders (NAHB) and Wells Fargo Housing Market Index rising score of 78 points in August. This point score of 78 matches a previous record high set in December, 1998 that gauges builder perceptions and confidence of current single-family home sales and sales expectations for the pending six months ahead.
The Western region of the country was the beneficiary of the most confidence by homebuilders. Confidence increased 15 points to 78 in the West for the HMI three-month moving averages. Confidence by homebuilders in the South increased to 71 points, in the Northeast to 65 points and to 63 points in the Midwest.
Robert Dietz, NAHB chief economist, said, “Housing has clearly been a bright spot during the pandemic and the sharp rebound in builder confidence over the summer has led NAHB to upgrade its forecast for single-family starts, which are now projected to show only a slight decline for 2020.”
Wonder how many other industries and businesses across the US could say they could now project only a slight decline for 2020.
Thanks to HousingWire.
Also read: Affordability Often Linked to Price-to-Rent Ratios by State, Realities of Home Prices in New York State & Manhattan, Beach Towns Fear Collapse While College Towns Prepare for a “Corona-Coaster” Ride
