Pending home sales in California experienced
the first double digit drop in over a year in November, falling 13.6 percent
from October to a Pending Home Sale Index level of 93.8. The Index, based on signed contracts for home
purchases, was down 9.4 percent from the 103.5 level of November 2012. The California Association of Realtors®
(C.A.R.) blamed the November decline partially on seasonal factors but noted
that shrinking home affordability also played a role.
The Pending Home Sale Index is a leading
indicators of closed sales, which typically follow within 60 days.
C.A.R. also reported that equity or
non-distressed property sales increased their market share in November to 86.4
percent. It was the fifth straight month
that equity sales surpassed 80 percent of all sales; they were at an 85.4
percent level in October. In November
2012 equity sales made up only 64.6 percent of the market.
sales accounted for 8.8 percent of November sales, down from 9.5 percent in
October and 23.3 percent a year earlier.
Sales of foreclosed property (REO) had a 4.4 percent share compared to
4.7 percent in October and was the fourth straight month that REO sales
constituted less than 5 percent of all sales.
One year earlier 11.8 percent of sales were REO. Twenty-one of the 38 counties responding
to C.A.R.’s survey showed a month-over-month decrease in distressed sales with Santa Clara County having the lowest share at 4 percent.
Housing inventory levels improved
slightly for the second consecutive month but were still extremely low.
The Unsold Inventory Index for equity sales inched up from 3.4 months in
October to 3.6 months in November. The supply of REOs rose from 2.7
months in October to 3.4 months in November, and the supply of short sales
increased from 3.6 months in October to 4.2 months in November.
C.A.R.’s pending sales information
is generated from a survey of more than 70 associations of Realtors and
Multiple Listing Services throughout the state. 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.