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CALIFORNIA EXISTING HOME SALES DECLINE IN SECOND QUARTER; HOUSING AFFORDABILITY IMPROVES SHARPLY IN ALL REGIONS OF THE STATE

 CALIFORNIA EXISTING HOME SALES DECLINE IN SECOND QUARTER; HOUSING AFFORDABILITY IMPROVES SHARPLY IN ALL REGIONS OF THE STATE
 LOS ANGELES, Aug. 5 /PRNewswire/ -- Existing California detached home sales fell during the second quarter, compared with the first three months of this year and the second quarter of 1991, the California Association of REALTORS (C.A.R.) reported.
 "Housing sales were down statewide and in most regions, compared with the second quarter of last year because unusually high sales occurred when pent-up demand was released following the Gulf War," said C.A.R. President Chuck Lamb. "However, sales in the first half of this year were considerably stronger than in the second half of 1991," said Lamb.
 "Once the California economy begins to recover, the state's housing market will have all of the ingredients it needs to gain momentum -- spectacular interest rates, a wide variety of homes for sale in all price ranges, and favorable prices," said Lamb, a San Fernando Valley REALTOR.
 Among elements of C.A.R.'s second-quarter and first-half housing sales report:
 -- Statewide, 438,450 existing, single-family detached homes closed escrow during the second quarter on an annualized basis -- down 0.9 percent from a revised annualized rate of 442,230 sales in the first quarter of 1992;
 -- Second quarter sales were 9.9 percent lower than the revised second-quarter 1991 pace, when 486,870 homes were sold on an annualized basis.
 The annualized figure represents what would be the total number of homes sold during 1992 if sales occurred at the second quarter pace throughout the year. It is adjusted to account for seasonal factors which influence home sales;
 -- During the first half of 1992, California existing home sales were higher than the level recorded during the last six months of 1991. From January through June, 440,340 single-family, detached homes closed escrow on a seasonally adjusted, annualized basis -- up 8.7 percent from the second half of 1991, when 405,020 homes were sold on an annualized basis;
 -- This year's first-half sales were down only 0.7 percent from the first six months of 1991, when an annualized rate of 443,350 homes were sold;
 -- Statewide, the median sales price of an existing, single- family home was $201,180 in the second quarter, up 0.9 percent from $199,480 in the first quarter but down 3.5 percent from $208,560 in the second quarter of 1991;
 -- For the first half of 1992, the median home price was $200,370, down 0.2 percent from $200,820 during the last half of 1991 and 2.0 percent from $204,360 during the first half of 1991;
 -- The inventory of unsold detached homes was significantly reduced from the first quarter level, as measured by C.A.R.'s Unsold Inventory Index. The index indicates the number of months it would take to deplete the supply of homes on the market at the current rate of sales. For the April through June period, the index was 12.5 months, down from 15.3 months in the previous quarter but up from 10.3 months in the second quarter of 1991;
 -- Unlike the detached housing market, sales of existing condominiums jumped sharply during the second quarter. Condo sales rose 27.5 percent in the second quarter on a non-seasonally adjusted basis but were down 12.7 percent from the second quarter of 1991;
 -- The statewide median price of an existing condominium edged up 0.7 percent from $146,700 in the first quarter to $147,710 in the second quarter. The second quarter figure was virtually unchanged from the $147,860 reported in the second quarter of 1991.
 -- The condominium Unsold Inventory Index also improved markedly in the second quarter, compared with the first quarter. The index fell from 15.6 months in the first quarter to 13.1 months in the second quarter, but was up from 9.7 months in the second quarter of 1991.
 Regionally, all of the state's housing markets, except the Santa Clara area, posted double-digit percentage increases in sales on a non-seasonally adjusted basis during the second quarter, compared with the first quarter. Median sales prices rose from first-quarter figures in most regions of the state, C.A.R. said. (Regional sales data are not adjusted to account for seasonal factors which influence home sales.);
 -- Mortgage interest rates continued to be favorable during the second quarter and recently have fallen to even lower levels. According to the Federal Home Loan Mortgage Corp., fixed-rate mortgages averaged 8.66 percent in the second quarter, down from 8.71 percent in the first quarter and 9.53 percent in the second quarter of 1991. Adjustable-rate mortgages averaged 5.99 percent in the second quarter, up from 5.96 percent in the previous quarter but down from 7.28 percent in second-quarter 1991.
 "Thirty-year fixed mortgage rates have fallen substantially just since the end of the second quarter," said Leslie Appleton-Young, C.A.R.'s vice president of research and economics. "At a current average of about 8 percent, fixed mortgage rates are at their lowest level in nearly 20 years," Appleton-Young said. "We can expect these favorable rates to remain with us at least through the end of the year," said Appleton-Young.
 Housing affordability improved significantly throughout California during the second quarter, thanks to the sharp drop in mortgage interest rates during the past year;
 -- Statewide, 29 percent of households earned the minimum income needed to qualify to purchase a detached home at the end of the second quarter, up from 23 percent a year ago. Assuming a 20 percent downpayment on a median-priced home, which sold for $200,620 in June, a household needed a minimum annual income of $57,864 to qualify for a home loan. The monthly mortgage payment on that home -- including property taxes and insurance -- would be $1,447; and
 -- Forty-three percent of households could qualify for a mortgage to purchase a median-priced condominium in June, up from 39 percent in June 1991. Assuming a 20 percent downpayment on a $146,990 median-priced condominium, a household needed a minimum annual income of $42,397 to qualify for a loan. The monthly mortgage payment on that condominium would be $1,060.
 C.A.R. median price and sales data for detached homes are based on reports from 83 boards of REALTORS around the state. Median condominium price and sales data are based on a survey of 32 boards. The median price for both detached homes and condominiums is based on closed escrow sales. Sales revisions reflect the re-seasonalization of monthly sales data using seasonal factors calculated with the 1979-1991 sales.
 The California Association of REALTORS is a statewide trade association with 130,000 members dedicated to the advancement of professionalism in real estate. C.A.R. is headquartered in Los Angeles.
 CALIFORNIA ASSOCIATION OF REALTORS
 Second Quarter 1992 Regional Sales and Price Activity(a)
 Regional and Condo Sales Data Not Seasonally Adjusted
 Percent Percent Percent Percent
 Change Change Change Change
 in in in Sales in Sales
 Price Price Activity Activity
 Median from from from from
 Price 1st Q 92 2nd Q 91 1st Q 92 2nd Q 91
 Calif. (sf) $201,180 0.9 pct -3.5 pct -0.9 pct -9.9 pct
 Calif.
 (condo) $147,710 0.7 pct -0.1 pct 27.5 pct -12.7 pct
 Region
 Central Val. $119,890 -0.7 pct -0.7 pct 22.0 pct -7.4 pct
 High
 Desert(b) $110,940 -0.8 pct -0.7 pct 24.3 pct -12.2 pct
 Los Angeles $216,580 -0.6 pct -3.6 pct 36.3 pct -19.3 pct
 Monterey $228,010 -1.3 pct -4.0 pct 31.1 pct 12.2 pct
 Nor. Calif. $138,460 0.8 pct 0.7 pct 31.4 pct 26.1 pct
 Nor. Wine
 Co. $195,500 1.0 pct 6.9 pct 53.4 pct -5.5 pct
 Orange Co. $238,100 1.3 pct -1.0 pct 37.2 pct -8.5 pct
 Palm Springs/
 Lwr. Desert
 (b) $133,380 11.6 pct 4.2 pct 44.4 pct -5.2 pct
 Riverside/
 S.B. $136,250 -0.9 pct 1.5 pct 38.2 pct -19.2 pct
 Sacramento $135,890 0.3 pct -2.4 pct 15.5 pct -7.7 pct
 San Diego $185,150 1.3 pct -1.8 pct 43.6 pct -1.7 pct
 S.F. Bay $262,020 5.4 pct -3.1 pct 21.8 pct -9.4 pct
 Sta. Barbara
 (b) $221,000 2.8 pct -3.9 pct 51.9 pct 1.4 pct
 Sta. Clara $259,330 4.6 pct -3.3 pct -8.1 pct -13.5 pct
 Ventura $226,890 0.2 pct -3.9 pct 59.3 pct -11.1 pct
 (a) Based on closed escrow sales of single-family, detached homes only (no condos). Reported month-to-month changes in sales activity may overstate actual changes because of the small size of individual regional samples. Movements in sales prices should not be interpreted as measuring changes in the cost of a standard home. Prices are influenced by changes in cost and changes in the characteristics and size of homes actually sold.
 (b) Due to the small sample size in these areas, prices and activity changes may be overemphasized.
 NOTE: sf - single-family detached
 Source: California Association of REALTORS
 A comparison of median home prices by region for the second quarter of 1992 and the second quarter of 1991.
 2nd Quarter 2nd Quarter
 1992 1991
 California (sf) $201,180 $208,560
 California (condo) $147,710 $147,860
 Region
 Central Valley $119,890 $120,690
 High Desert $110,940 $111,750
 Los Angeles $216,580 $224,580
 Monterey $228,010 $237,520
 Nor. California $138,460 $137,540
 Nor. Wine Country $195,500 $182,890
 Orange County $238,100 $240,470
 Palm Springs/Lwr. Desert $133,380 $128,000
 Riverside/San Bernardino $136,250 $134,250
 Sacramento $135,890 $139,190
 San Diego $185,150 $188,560
 San Francisco Bay $262,020 $270,420
 Santa Barbara $221,000 $229,860
 Santa Clara $259,330 $268,120
 Ventura $226,890 $236,150
 Source: California Association of REALTORS
 June 1992 Housing Affordability Index
 Median Monthly Minimum Percent
 Home Sales Housing Qualifying Households
 Price Payment(a) Ann.Income Qualifying
 United States $105,100 $758 $30,314 52 pct
 California (sf) 200,620 1,447 57,864 29 pct
 California (condo) 146,990 1,060 42,397 43 pct
 Los Angeles 214,540 1,547 61,880 28 pct
 Orange County 237,200 1,710 68,416 32 pct
 Riverside/San
 Bernardino 135,410 976 39,057 41 pct
 Sacramento 137,000 988 39,515 41 pct
 San Diego 183,390 1,322 52,896 29 pct
 San Francisco Bay 263,770 1,902 76,080 19 pct
 Ventura 222,930 1,608 64,300 29 pct
 June 1991 Housing Affordability Index
 Median Monthly Minimum Percent
 Home Sales Housing Qualifying Households
 Price Payment(a) Ann.Income Qualifying
 United States $102,100 $ 796 $31,860 49 pct
 California (sf) 206,720 1,613 64,506 23 pct
 California (condo) 145,750 1,137 45,480 39 pct
 Los Angeles 228,050 1,779 71,163 20 pct
 Orange County 240,540 1,876 75,059 24 pct
 Riverside/San
 Bernardino 134,090 1,046 41,842 36 pct
 Sacramento 136,800 1,067 42,688 36 pct
 San Diego 190,540 1,486 59,457 24 pct
 San Francisco Bay 273,970 2,137 85,491 15 pct
 Ventura 241,800 1,886 75,452 18 pct
 sf - single-family, detached
 (a) Including property taxes and insurance
 Source: California Association of REALTORS
 -0- 8/5/92
 /CONTACT: Lotus Lou or Jeff Hershberger of the California Association of REALTORS, 213-739-8304/ CO: California Association of REALTORS ST: California IN: FIN SU:


AL -- LA012 -- 7038 08/05/92 11:01 EDT
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