California existing home sales fell in November from both the previous month and year for the first time in nearly a year as low housing affordability extended into Southern California.
The California Association of Realtors reported this week that home sales posted below the 400,000 level in November for the first time since March 2015 and were at the lowest level since February 2015.
Closed escrow sales of existing, single-family detached homes in California totaled a seasonally adjusted annualized rate of 369,680 units in November, according to information collected by CAR from more than 90 local Realtor associations and MLSs statewide.
The statewide sales figure represents what would be the total number of homes sold during 2015 if sales maintained the November pace throughout the year. It is adjusted to account for seasonal factors that typically influence home sales.
The November figure was down 8.4% from the revised 403,580 level in October and down 1.6% compared with home sales in November 2014 of a revised 375,740.
The year-to-year decrease was the first since January 2015 and was significantly below the six-month average of 8.3% observed between May 2015 and October 2015.
"The Consumer Financial Protection Bureau's 'Know Before You Owe' (TRID) disclosure requirement, which was implemented in early October, may have affected home sales in the last couple of months," said CAR President Ziggy Zicarelli.
"Some sales may have been either pulled forward into September to beat TRID's effective date or been delayed," Zicarelli added. "The impact, however, should be transitory as the roll-out and implementation process move further along."
The median price of an existing, single-family detached California home dipped 0.2% in November to $475,000 from $475,990 in October. November's median price was 6.8% higher than the revised $444,630 recorded in November 2014. The median sales price is the point at which half of homes sold for more and half sold for less; it is influenced by the types of homes selling as well as a general change in values. The year-to-year price gain was the highest since June 2015.
"The Federal Reserve's announcement to raise the federal funds rate negligibly has long been anticipated and shouldn't have a significant adverse impact on the housing market since rates are still historically low," said CAR Vice President and Chief Economist Leslie Appleton-Young.
"In fact, it may spur potential home buyers who have been waiting on the sidelines to finally jump in now that they see the rates may continue to rise slowly in the next couple of years," she added.
Other key points from CAR's November 2015 resale housing report include:
As sales activity softened in November, there were also fewer active listings compared to the previous year. The number of active listings continued to drop from both the previous month and year. Active listings at the statewide level dropped 11.1% from October and decreased 8.8% from November 2014.
The Unsold Inventory Index rose in November for the first time in four months, increasing to 4.2 months from 3.7 months in October but down slightly from 4.3 months in November 2014. The index indicates the number of months needed to sell the supply of homes on the market at the current sales rate. A six- to seven-month supply is considered typical in a normal market.
The median number of days it took to sell a single-family home increased in November to 37.8 days, compared with 35.4 days in October and 40.5 days in November 2014.
According to CAR's newest housing market indicator which measures the sales-to-list price ratio*, properties are generally selling below the list price, except in the San Francisco Bay Area, where a lack of homes for sale is pushing sales prices higher than original asking prices. The statewide measure suggests that homes sold at a median of 98.1% of the list price in November, up from 97.4% at the same time last year. The Bay Area is the only region where homes are selling above original list prices due to constrained supply with a ratio of 101.4% in November, down from 102.2% in October and up from 100.6% a year ago.
The average price per square foot** for an existing, single-family home was $235 in November 2015, up from $230 in November 2014. Price per square foot at the state level has been stabilizing in the last few months as the statewide median price began leveling off and averaging an increase of 2.4% in the past three months.
San Francisco had the highest price per square foot in November at $789/sq. ft., followed by San Mateo ($724/sq. ft.), and Santa Clara ($580/sq. ft.). The three counties with the lowest price per square foot in November were Tehama ($112/sq. ft.), Siskiyou ($112/sq. ft.), and Kings ($114/sq. ft.).
Mortgage rates inched up in November, with the 30-year, fixed-mortgage interest rate averaging 3.94%, up from 3.80% in October but down from 4.0% in November 2014, according to Freddie Mac. Adjustable-mortgage interest rates also edged up, averaging 2.63% in November, up from 2.56% in October and up from 2.44% in November 2014.