California home sales followed typical seasonal trends in September as the market moves into winter, according to the latest California housing report from PropertyRadar.
The state’s September single-family home and condominium sales dipped to 35,842, a decline of 10.4% from August and a decline of 6.7% from 38,397 in September 2015.
“The normal seasonal sales decline began in September so taking a longer term view gives a better picture of the market,” said Madeline Schnapp director of Economic Research for PropertyRadar.
With this in mind, Schnapp explained, “Sales from the January through September period fell 3.7% compared to the same period in 2015 and were the lowest since 2011. Despite lower sales, prices continue to climb higher, albeit at a slower pace than prior years.”
So what’s the good news? According to Schnapp, “The silver lining in rising prices is it allows underwater homeowners to escape their negative equity prisons.”
“These newly freed homeowners can now refinance, taking advantage of near record low interest rates, or sell their home or buy another and become active participants in the housing market,” she continued,
The September median price of a California home barely moved, coming in at $434,500, nearly unchanged from August’s $435,000 but up 6.6% from $407,500 a year ago.
Meanwhile, the number of homeowners in a negative equity position decreased to approximately 450,000 in September 2016, a decline of nearly 20%, or 115,000, since September 2015.
Analyzing the entire year, Schnapp states that this year was another year plagued with lackluster sales and rising prices, with the lack of inventory a common theme up and down the state.
“Restrictive zoning laws, rising building costs and limited affordability have kept a lid on supply. Fortunately, rising single-family permits and starts in many areas throughout the state promises to provide some relief in 2017,” said Schnapp.
However, the California Association of Realtors recently gave its 2017 housing market forecast, predicting that the trials that plagued the California housing market in 2016 aren’t expected to get too much better in 2017.
Affordability is only projected to get worse, which is currently already California real estate agents’ No. 1 concern for the market.