Solid housing market continues as California pending home sales dial higher from year ago for fifth straight month, C.A.R. reports

Competitive market persists with more sales and bigger premiums paid above list price.

May 21, 2015, 10:01 ET from CALIFORNIA ASSOCIATION OF REALTORS

LOS ANGELES, May 21, 2015 /PRNewswire-USNewswire/ -- With the California housing market continuing its upward trend, pending home sales registered their fifth straight annual gain, with the last three months being in the double-digits, the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) said today. 

In a separate report, California REALTORS® responding to C.A.R.'s April Market Pulse Survey saw more floor calls and all cash purchases, compared to March. The Market Pulse Survey is a monthly online survey of more than 300 California REALTORS®, which measures data about their last closed transaction and sentiment about business activity in their market area for the previous month and the last year.

Pending home sales data:

  • California pending home sales were up 13.6 percent on an annual basis from the 114 index recorded in April 2014, marking the fifth straight month of year-to-year gains and the third straight month of double-digit advances.
  • Statewide pending home sales dipped slightly in April, with the Pending Home Sales Index (PHSI)* decreasing 0.6 percent from a revised 130.2 in March to 129.4, based on signed contracts.  The month-to-month decrease was below the average March-April gain of 1.7 percent observed in the last seven years.
  • Pending home sales in the San Francisco Bay Area, Southern California, and Central Valley regions posted back-to-back, double-digit, year-over-year gains.
  • San Francisco Bay Area's PHSI stood at 136.6 in April, down 6.8 percent from 146.6 in March but up 12 percent from the 122 index recorded in April 2014.
  • Pending home sales in Southern California were down 10.4 percent in April to reach an index of 103.5, but were up 13.5 percent from the April 2014 index of 91.2.
  • Central Valley pending sales increased 28.1 percent from March to reach an index of 129.1 in April, and up 15.8 percent from the 111.5 index of April 2014. 

Equity and distressed housing market data:

  • The share of equity sales – or non-distressed property sales – edged up in April to make up 91.9 percent of all home sales, the highest level since 2007. Equity sales made up 91 percent of all home sales in March and 88.3 percent in April 2014. The share of equity sales has been at or near 90 percent since mid-2014.
  • Conversely, the combined share of all distressed property sales (REOs and short sales) fell in April, down from 9 percent in March to 8.1 percent in April.  Distressed sales made up 11.7 percent of total sales a year ago. Twenty-three of the 43 counties that C.A.R. reported showed month-to-month decreases in their distressed sales shares, with San Mateo having the smallest share of distressed sales at 1 percent, followed by San Francisco (2 percent), and Santa Cruz (2 percent).  Kings and Plumas counties had the highest share of distressed sales at 24 percent, followed by Amador, Lake, and Tulare (all at 16 percent).

April REALTOR® Market Pulse Survey**:

  • The share of sales closing above asking price has been on an upward trend for three straight months, indicating the return of bidding wars in some local markets. More than a third (36 percent) of transactions closed above asking price in April, up from the lowest point of 16 percent in January 2015.  More than four in 10 homes (41 percent) closed below asking price, and 23 percent closed at asking price.
  • The premium paid over asking price increased in April, suggesting heightened market competition among home buyers. In April, homes that sold above asking price sold for an average of 10 percent above asking price, up from 7.7 percent in March and up from 8.7 percent in April 2014.
  • Homes that sold below asking price sold for an average of 11 percent below asking price in April, unchanged from January.
  • The share of properties receiving multiple offers increased for the fourth straight month. Seventy-two percent of properties received multiple offers in April, up from 62 percent in March and up from 71 percent a year ago.
  • The average number of offers per property also has been increasing since January. In April, the average number of offers on a property was 3.6, up from 2.7 in March and up from 2.9 a year ago.
  • All cash purchases and open house traffic were up in April, compared to the previous year, suggesting the spring/summer home-buying season is off to a strong start.
  • The majority (55 percent) of REALTORS® expect better market conditions over the next year.

Graphics (click links to open): 

Share of Distressed Sales to Total Sales
(Single-family)

Type of Sale

April
2015

March
2015

April
2014

Equity Sales

91.9%

91.0%

88.3%

Total Distressed Sales

8.1%

9.0%

11.7%

     REOs

4.0%

4.8%

5.4%

     Short Sales

3.8%

3.8%

5.8%

     Other Distressed Sales (Not Specified)

0.4%

0.4%

0.5%

All Sales

100.0%

100.0%

100.0%

Single-family Distressed Home Sales by Select Counties
(Percent of total sales)

County

April
2015

March
2015

April
2014

Alameda

3%

4%

4%

Amador

16%

9%

22%

Butte

14%

13%

20%

Calaveras

15%

6%

18%

Contra Costa

3%

5%

6%

El Dorado

9%

10%

15%

Fresno

12%

14%

19%

Glenn

5%

14%

23%

Humboldt

7%

12%

13%

Kern

8%

9%

19%

Kings

24%

21%

23%

Lake

16%

9%

26%

Los Angeles

7%

8%

12%

Madera

14%

11%

11%

Marin

3%

2%

5%

Mariposa

11%

0%

40%

Mendocino

7%

15%

27%

Merced

8%

12%

12%

Monterey

5%

7%

13%

Napa

6%

5%

6%

Orange

5%

4%

7%

Placer

8%

7%

9%

Plumas

24%

27%

35%

Riverside

10%

12%

15%

Sacramento

11%

13%

16%

San Benito

12%

8%

4%

San Bernardino

11%

14%

18%

San Diego

5%

5%

4%

San Francisco

2%

2%

2%

San Joaquin

13%

15%

19%

San Luis Obispo

6%

6%

4%

San Mateo

1%

1%

2%

Santa Clara

3%

2%

4%

Santa Cruz

2%

4%

9%

Shasta

12%

14%

20%

Siskiyou

13%

24%

24%

Solano

9%

11%

14%

Sonoma

5%

5%

9%

Stanislaus

11%

14%

15%

Sutter

11%

11%

17%

Tulare

16%

18%

24%

Yolo

7%

7%

12%

Yuba

11%

15%

28%

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*Note:  C.A.R.'s pending sales information is generated from a survey of more than 70 associations of REALTORS® and MLSs throughout the state.  Pending home sales are forward-looking indicators of future home sales activity, offering solid information on future changes in the direction of the market.  A sale is listed as pending after a seller has accepted a sales contract on a property.  The majority of pending home sales usually becomes closed sales transactions one to two months later.  The year 2008 was used as the benchmark for the Pending Homes Sales Index.  An index of 100 is equal to the average level of contract activity during 2008.

**C.A.R.'s Market Pulse Survey is a monthly online survey of more than 300 California REALTORS® to measure data about their last closed transaction and sentiment about business activity in their market area for the previous month and the last year.

Leading the way...® in California real estate for 110 years, the CALIFORNIA ASSOCIATION OF REALTORS® (www.car.org) is one of the largest state trade organizations in the United States with 175,000 members dedicated to the advancement of professionalism in real estate. C.A.R. is headquartered in Los Angeles. 

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SOURCE CALIFORNIA ASSOCIATION OF REALTORS



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