Sales and median home prices went up according to the C.A.R. reports for California in May 2017. Statewide, the median home sale price was up 2.3% in April and another 5.8% in May. San Francisco Bay Area sales saw a year-to-year increase of 4.9%, as well.
Strong gains in both the median home prices and sales across the state show a bounce back for California. The trend in every major area is up with closed escrow sales of existing homes above the 400,000 mark for the 14th month in a row. One huge factor in this increase may be the lower mortgage rates. They are actually at the lowest rate since November 2016 and this could be causing more buyers to enter the market.
San Francisco Bay Area Sales Median Prices in California
Across the state, the median price as above $500K for the third month in a row. It was actually at the highest level for the state since August of 2007. In April, the median price reached $537,920, but in May it jumped up to $550,200. This was much higher than the $519,930 price for May of 2016.
Prices are headed up because of lower supply, which can actually be an issue, but the market has remained strong. When this is combined with higher interest rates, it can make it hard for buyers to afford to enter the market. However, the interest rates have remained lower, making the spring housing market perform well.
Sales Increases Across the State
It wasn’t just one area of California seeing an increase in sales. Sales increased across all major regions compared to the same time last year. Inland Empire saw the largest gain with a 9% increase, while the Los Angeles area saw a 6.9% increase. Even the San Francisco Bay Area sales saw a good increase at a healthy increase of 4.9%.
Sales may be up, but active listing has fallen for the 23rd month in a row. In May, listing fell by 12.4% compared to the same time last year. This caused the inventory of housing for May to become even worse. It fell from 3.3 months in April to just 2.9 months of inventory in May. In May of 2016, the index was at 3.4 months.
The inventory numbers were a problem across the entire state. In fact, 42 of the 51 counties reported a drop in unsold inventory compared to last year. San Mateo, Santa Clara and Alameda had the lowest inventory at just 1.7 months, while San Francisco County was right behind at 1.9 months. However, San Francisco bay area sales did report the highest price per square foot at $918 for May.
Mortgage rates have dipped even lower, as well. The average for May was 4.01%, which is down from 4.05% in April. However, it’s still up from last year, which was 3.6% in May.
With mortgage rates dipping a bit, sales have been up. However, the entire state is still struggling with a lack of housing inventory.