LOS ANGELES — Strong sales growth in higher-priced markets and continued housing supply shortage pushed up California’s median home price in May, resulting in the largest year-over-year price gain in at least the last 33 years, the California Association of Realtors reported.
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“It’s encouraging to see median home prices across most parts of the state continuing to recover. The Bay Area, in particular, has been experiencing strong price appreciation, thanks to the region’s robust economic growth, extremely low housing inventory and an increasing demand from international buyers,” said CAR President Don Faught. “San Francisco County’s median home price, for example, increased 32 percent from last May and has just surpassed its previous record high reached in May 2007.”
Closed escrow sales of existing, single-family detached homes in California totaled a seasonally adjusted annualized rate of 431,370 units in May, according to information collected by CAR from more than 90 local Realtor associations and MLSs statewide. Sales in May were up 1.9 percent from a revised 423,420 in April but down 3.6 percent from a revised 447,530 in May 2012. The statewide sales figure represents what would be the total number of homes sold during 2013 if sales maintained the May pace throughout the year. It is adjusted to account for seasonal factors that typically influence home sales.
The statewide median price of an existing, single-family detached home rose 3.6 percent from April’s median price of $402,760 to $417,350 in May. May’s price was up 31.9 percent from a revised $316,460 recorded in May 2012, marking 15 straight months of annual price increases and the eleventh consecutive month of double-digit annual gains. The year-over-year price increase was the highest since at least 1980, when CAR began tracking this statistic. 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.
“While home prices are increasing at levels above those observed in 2006-07, the fundamentals of the housing market are much more solid than what we experienced a few years ago,” said CAR Vice President and Chief Economist Leslie Appleton-Young. “More home buyers are putting down larger down payments, and many of them are opting for more stable loan products. Additionally, historically low mortgage rates have reduced monthly mortgage payments substantially, making owning a house more affordable, even with rising home prices.”
Other key facts of CAR’s May 2013 resale housing report include: