The Real Deal

Median prices are up, sales are down

Although the latest forecast for the real estate market for the year 2002 looks positive, sales of existing homes in California in November fell 12.4 percent. However, median home prices rose 11.2 percent compared to the same period a year ago, according to the most recent figures available from the California Association of Realtors and Real Estate Solutions, a real estate information service.

"Sales in November 2000 were the fifth highest level on record, so it's no surprise to see a year-to-year decline," said the association's President Robert Bailey. "In the San Francisco Bay Area, sales continue to be impacted by the overall weakness of the region's economy. By comparison, Southern California posted moderate sales declines. "The median price continues to climb in most areas of the state and reached $278,740 last month, a new record for California," he said.

Closed escrow sales of existing, single-family detached homes in California totaled 493,870 in November at a seasonally adjusted annualized rate, according to information collected by the association from more than 90 Multiple Listing Services (MLS) statewide. Statewide home resale activity decreased 12.4 percent from the 563,800 sales pace recorded in November 2000. Resale activity posted a decrease of 0.2 percent in November compared to October. The statewide sales figure represents what the total number of homes sold during 2001 would be if sales maintained the November 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 November 2001 was $278,740, an 11.2 percent increase over the $250,660 median for November 2000 according to the report. The November 2001 median price increased 2.4 percent compared to October 2001.

Thirty-year fixed mortgage interest rates averaged 6.66 percent during November 2001, down from 7.73 percent in November 2000, according to the Federal Home Loan Mortgage Corp. Adjustable mortgage interest rates averaged 5.20 percent in November 2001, compared to 7.22 percent in November 2000.

The median number of days it took to sell a single-family home was 31 days in November 2001, compared to 33 days for the same period a year ago.

Regional sales data is not adjusted to account for seasonal factors that can influence home sales. The MLS median price and sales data for detached homes is generated from a survey of more than 90 associations of Realtors throughout the state. MLS median price and sales data for condominiums is based on a survey of 64 associations. The median price for both detached homes and condominiums represents closed escrow sales.

"Two thousand one looks like it'll end up as one of the strongest years on record," said Leslie Appleton-Young, vice president and chief economist for the California Association of Realtors. "Although sales are leveling off compared to last year's near record pace, inventory remains low in most areas of the state, year-to-year declines in mortgage interest rates have helped improve affordability and demand for housing remains strong."

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Information provided in this column is presented by the Realtor members of the Silicon Valley Association of Realtors at www.siliconvalley-realtors.org. Send questions on any topic to jnewton@jnpr.com.

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