A Glimpse of Home as Sales Perk Up
Looking at the numbers today, it's not a wonder why housing markets are doing so well in the second half of the year. I mean, mortgage interest rates are the lowest they have been in three years! Statewide, existing home sales have increased year-over-year for the first time since April 2018. For us here in Alameda and Contra Costa Counties, it feels like it's been slow since January 2018. We blogged about it too.
Since April 2018, sales at the state level have climbed back above the 400,000 benchmark and reached the highest level in 15 months! The number of existing single-family home sales was up 5.6% from June, up 1.1% from July 2018, but remained down year-to-date by 4.9% from the same time frame last year.
Home sales for luxury and affordable homes both declined year-over-year, while the rest of the price points improved from last year. Sales below $300,000 declined by 8% from last July, primarily due to the supply just sucking (if you're looking in this price point, you know what we're saying!). Sales $2 million and up also dropped 1.4%, probably because there's just not many who can afford that home at this time.
For the homes currently on the market (our current supply), the sates unsold inventory index dipped in July 2019 to 3.2 months from last year's 3.3 months. It was the first drop since April 2018. Economists are giving credit for this dip in the index to an increase in sales and a decrease in active listing (haha, right though?). While home sales increased for the first time in over a year, the state's housing supply also had its first decline since March 2018. Active listing fell 2.1% from July 2018, after increasing year-over-year for 15 consecutive months.
Finding an affordable home is starting to get a little difficult, as there were fewer homes for sale in the $500,000 or less market in July. The number of active listings priced below $300,000 decreased 14.8%! The ones priced between $300,000 and $500,000 also dipped 7.8%. The homes priced at or above $750,000 increased modestly in the latest month and thank God the high-end markets continued to soften for those wanting to purchase.
On to median price homes... They continued to grow on a year-over-year basis, but over the last 3 months, there was a record-setting price streak broken after the new purchase price sales numbers were registered. New highs made the median price of an existing single-family home in California above $600,000 for the 4th consecutive month since April 2019! It slightly dipped to $607,990 from the prior month's $610,720. This is still a 2.8% increase from the same month of last year. While the yearly growth rate of the state median price is the highest recorded in the last 3 months, it is still soft compared to 2018. The year-over-year growth rate for the first 7 months in 2019 averaged only 1.9%, compared to 8.4% in 2018 and 6.6% in 2017.
On to the crystal ball reading... (I know this is the only reason you read my blog anyway) Economists believe, if you're ready to make a purchase for the long-term benefits of home ownership, personal wealth building and quality of life benefits, 2019 is still a great time to buy a home for the long hall. The reason is, softer home prices mixed with low interest rates. This will allow you to save hundreds of dollars per month on the same home, or you could even consider a slightly more expensive home for the same monthly cost. This is an important decision you'll have to make during the second half of 2019.
Remember, when you are ready to buy or sell a home, make contact with us? We are ready when you are!
-Elizabeth Russo and Tim Hanford (a father-daughter team)