Why Can’t Paradise be Cheaper? California’s June 2018 housing numbers – Thousand Oaks Local News, Oxnard Local News, Simi Valley Local News, Ventura County Local News

California Association of Realtors — CALIFORNIA ASSOCIATION OF REALTORS (PRNewsFoto/C.A.R.)

(Los Angeles, Ca) Combine unaffordable home prices with a low inventory and you get home sales numbers like the ones just released for June 2018 that reflect why 100,000 people annually engage in the mass exodus out of California despite the beautiful landscape and ideal weather. So why can’t paradise be cheaper?

California’s median home price edged higher to another peak in June as year-over-year home sales lost steam for the second straight month, according to information shared by the CALIFORNIA ASSOCIATION OF REALTORS^® (C.A.R.). The highlights were as follows:

Existing, single-family home sales totaled 410,800 units in June on a seasonally adjusted annualized rate, up 0.4 percent from May and down 7.3 percent from June 2017
June’s statewide median home price was $602,760, up 0.3 percent from May and 8.5 percent from June 2017, hitting another peak.
California condominiums / townhomes recorded a 7.0 percent price increase and a 7.1 percent sales decline from June 2017.
Ventura County median home sales are among the highest in the state at $675,000 up from $670,000 in May 2018
Ventura County has among the worst year-over-year slow downs compared to all California counties with an 18% drop in home sale volume
Ventura County median home prices have increased by 5.9% year-over-year.

President Trump & Homeowner Lending

When asked about factors impacting the slow down in purchases, C.A.R. Senior Economist Jordan Levine shared, “The Pendulum swung too far after the housing downturn. Qualifications for loans were made more demanding with median credit scores between 750-760. So many qualified buyers were frozen out of market.” Levine went on to add that the incredibly low inventory has put upward pressures on prices. Ventura County has one of the lowest volume levels in the state with just 1.5 months worth of inventory.

In the past year, the Trump administration has worked to pass laws making it easier for banks to make loans to small businesses and consumers. The Volker rule, a federal regulation passed after the Great Recession that generally prohibits banks from conducting certain investment activities with their own accounts and limits their dealings with hedge funds and private equity funds, was rolled back to apply only to banks managing more than $10B, which in general excludes credit unions and smaller local banks. This and other changes passed 0n May 24, 2018. Still, more legislation is being written to further assist banks to broaden their ability to lend to a wider swath of qualified borrowers.

When asked about whether the impending federal legislative changes to banking laws could help California’s housing issues, Levine replied, “Easing credit standards for borrowers may be able to help buyers get into the market. We would not want to see all the kinds of things that caused banks to take too much risk (like putting certain borrowers in ARM’s (or Adjustable Rate Mortgages), or unverified income, or similar). Some easing of credit standards will help but we would caution going too far where we have the housing market teetering on an unstable financial market.”

Levine shared that in general, benefits to the real estate market from lending changes may take effect within the next 3-6 months from when they are enacted.

Detailed Analysis of June 2018 Numbers

Closed escrow sales of existing, single-family detached homes in California totaled a seasonally adjusted annualized rate of 410,800 units in June, according to information collected by C.A.R. from more than 90 local REALTOR^® associations and MLSs statewide. The statewide annualized sales figure represents what would be the total number of homes sold during 2018 if sales maintained the June pace throughout the year. It is adjusted to account for seasonal factors that typically influence home sales.

June’s sales figure was up 0.4 percent from the revised 409,270 level in May and down 7.3 percent compared with home sales in June 2017 of 443,120. The year-over-year sales decline was the largest in nearly four years.

“California’s housing market underperformed again, despite an increase in active listings for the third straight month,” said C.A.R. President Steve White. “The lackluster spring homebuying season could be a sign of waning buyer interest as endlessly rising home prices and buyer fatigue adversely affected pent-up demand.”

For the second straight month, the statewide median home price hit another peak price at $602,760 in June. The June statewide median price was up 0.3 percent from $600,860 in May and up 8.5 percent from a revised $555,420 in June 2017. June marked the fifth consecutive month that prices increased by more than 8 percent annually, indicating that price appreciation remains robust and is not showing any signs of leveling off. The median price is now 1.4 percent higher than the pre-recession peak and has been growing on a year-over-year basis for more than six years.

“Although home prices increased year-over-year in virtually every region of the state in June, at the same time, nearly every county experienced a significant contraction in home sales from a year ago,” said C.A.R. Senior Vice President and Chief Economist Leslie Appleton-Young. “With the year-to-date sales tally now in negative territory, the back-to-back sales declines could be an early sign that the market is transitioning, especially since further rate increases are expected to hamper homebuyers’ affordability and put a cap on how much they are willing to pay for their new home.”

Additional Analysis of June 2018 numbers

Other key points from C.A.R.’s June 2018 resale housing report include:

On a regionwide, non-seasonally adjusted basis, all regions recorded year-over-year sales declines.
- Sales in the Bay Area dipped 0.8 percent monthly and fell 8.2 percent annually.
- Sales in the Inland Empire slipped 1.2 percent from May and was down 14.5 percent from a year ago.
- Sales in the Los Angeles metro region edged up 0.9 percent from May but was down 12.4 percent annually.
The Bay Area Region, which previously led the state in home sales, registered significant year-to-year sales decreases in seven of nine Bay Area counties. Only Alameda and San Francisco counties recorded annual sales gains, while Contra Costa, Marin, Napa, San Mateo, Santa Clara, Solano, and Sonoma counties experienced annual sales declines.
The Central Valley Region experienced the smallest sales contraction with sales falling 6 percent on an annual basis. Only Merced County posted a year-over-year sales increase, rising 15.2 percent from a year ago. Five counties – including Glenn, Kings, Madera, San Benito, and San Joaquin – posted double-digit annual declines, while Fresno, Kern, Placer, Sacramento, Stanislaus, and Tulare recorded single-digit annual decreases.
The Southern California Region suffered the largest home sales drop, falling 11.7 percent from May. Every county within the region posted declines with all but Orange and San Diego counties experiencing a year-over-year, double-digit pullback. Even the Inland Empire, which had been buoyed by San Bernardino County for the past several months, experienced significant declines.
By price segments, sales in every price category under $1 million contracted but lower-priced homes registered the largest sales decline as homes priced below $300,000 fell 23.8 percent from a year ago. At the other end of the spectrum, sales of homes priced $1 million and above increased 7.2 percent from June 2017. The very top end of the market, in particular, continues to post double-digits gains with homes priced over $2 million rising year-over-year by more than 13 percent in June.
The Bay Area continued to register the strongest home price gains with the region as a whole recording a 16.1 percent annual increase. While Contra Costa, Solano, and Napa counties experienced single-digit price advancements, the remaining regions experienced an uptick of more than 10 percent. Despite being two of the state’s least affordable markets outside of San Francisco, San Mateo and Santa Clara counties led the pack in price gains.
Home price growth in Southern California was more tepid by comparison, increasing by mid- to high-single-digits. Prices in San Bernardino – the most affordable county in the region – had the largest growth rate, and prices throughout the rest of the region grew at a more modest rate ranging between 5.1 percent and 6.9 percent.
Statewide active listings improved for the third consecutive month, increasing 8.1 percent from the previous year. The year-over-year increase was slightly below that of last month, which was the largest since January 2015, when active listings jumped 11.0 percent.
As sales declined from a year ago, the unsold inventory index, which is a ratio of inventory over sales, increased on a year-over-year basis as well. The statewide unsold inventory index edged up to 3.0 months in June from 2.7 months in June 2017. The index measures the number of months it would take to sell the supply of homes on the market at the current sales rate.
The median number of days it took to sell a California single-family home remained low at 15 days in June, unchanged from 15 days in June 2017.
C.A.R.’s statewide sales price-to-list price ratio* was 100 percent in June, unchanged from June 2017.
The average statewide price per square foot** for an existing, single-family home statewide was $290 in June, up from $270 in June 2017.
The 30-year, fixed-mortgage interest rates averaged 4.57 percent in June, down from 4.59 percent in May and up from 3.90 percent in June 2017, according to Freddie Mac. The five-year, adjustable mortgage interest rate, however, edged higher in June to an average of 3.82 percent from 3.79 percent in May and from 3.14 percent in June 2017.

Note: The County MLS median price and sales data in the tables are generated from a survey of more than 90 associations of REALTORS® throughout the state and represent statistics of existing single-family detached homes only. County sales data are not adjusted to account for seasonal factors that can influence home sales. Movements in sales prices should not be interpreted as changes in the cost of a standard home. The median price is where half sold for more and half sold for less; medians are more typical than average prices, which are skewed by a relatively small share of transactions at either the lower-end or the upper-end. Median prices can be influenced by changes in cost, as well as changes in the characteristics and the size of homes sold. The change in median prices should not be construed as actual price changes in specific homes.

*Sales-to-list price ratio is an indicator that reflects the negotiation power of home buyers and home sellers under current market conditions. The ratio is calculated by dividing the final sales price of a property by its last list price and is expressed as a percentage. A sales-to-list ratio with 100 percent or above suggests that the property sold for more than the list price, and a ratio below 100 percent indicates that the price sold below the asking price.

**Price per square foot is a measure commonly used by real estate agents and brokers to determine how much a square foot of space a buyer will pay for a property. It is calculated as the sale price of the home divided by the number of finished square feet. C.A.R. currently tracks price-per-square foot statistics for 50 counties.

June 2018 County Sales and Price Activity (Regional and condo sales data not seasonally adjusted)

June 2018	Median Sold Price of Existing Single-Family Homes							Sales
State/Region/County	June 2018	May 2018		June 2017		Price MTM% Chg	Price YTY% Chg	Sales MTM% Chg	Sales YTY% Chg
Calif. single-family home	$602,760	$600,860		$555,420	r	0.3%	8.5%	0.4%	-7.3%
Calif. Condo/Townhome	$482,930	$474,400		$451,450		1.8%	7.0%	-0.3%	-7.1%
Los Angeles Metro Area	$539,000	$530,000		$500,000		1.7%	7.8%	0.9%	-12.4%
Inland Empire	$360,000	$360,000		$345,000		0.0%	4.3%	-1.2%	-14.5%
San Francisco Bay Area	$1,045,000	$1,050,000	r	$900,000	r	-0.5%	16.1%	-0.8%	-8.2%

San Francisco Bay Area
Alameda	$1,015,000	$1,025,000		$900,000		-1.0%	12.8%	8.2%	3.2%
Contra Costa	$702,373	$687,500		$660,000		2.2%	6.4%	0.2%	-7.5%
Marin	$1,415,000	$1,415,000		$1,272,500		0.0%	11.2%	-3.8%	-7.3%
Napa	$740,000	$702,500		$685,000		5.3%	8.0%	0.0%	-17.5%
San Francisco	$1,620,000	$1,620,000		$1,469,000		0.0%	10.3%	-3.8%	3.2%
San Mateo	$1,650,500	$1,600,000		$1,433,750		3.2%	15.1%	-5.3%	-12.1%
Santa Clara	$1,400,000	$1,400,000		$1,182,500		0.0%	18.4%	-7.0%	-15.4%
Solano	$450,000	$451,000		$420,000		-0.2%	7.1%	-3.0%	-9.4%
Sonoma	$705,000	$698,500		$627,250		0.9%	12.4%	1.8%	-15.5%
Southern California
Los Angeles	$586,090	$536,940		$548,220		9.2%	6.9%	2.1%	-10.8%
Orange	$835,500	$838,000		$795,000		-0.3%	5.1%	1.1%	-9.9%
Riverside	$405,000	$409,925		$385,000		-1.2%	5.2%	-3.0%	-16.9%
San Bernardino	$293,250	$285,000		$270,000		2.9%	8.6%	1.8%	-10.2%
San Diego	$650,000	$640,000		$612,750		1.6%	6.1%	2.9%	-8.6%
Ventura	$675,000	$670,000		$637,500		0.7%	5.9%	6.5%	-18.0%
Central Coast
Monterey	$632,500	$677,000		$624,500		-6.6%	1.3%	-8.5%	-10.4%
San Luis Obispo	$612,500	$638,660		$556,000		-4.1%	10.2%	5.7%	9.2%
Santa Barbara	$753,750	$680,000		$767,500		10.8%	-1.8%	9.8%	-8.8%
Santa Cruz	$925,000	$865,000		$860,000		6.9%	7.6%	-3.9%	-12.1%
Central Valley
Fresno	$275,500	$279,980		$260,000		-1.6%	6.0%	2.3%	-3.6%
Glenn	$227,710	$230,000		$210,000		-1.0%	8.4%	-61.3%	-52.0%
Kern	$245,000	$247,750		$229,450		-1.1%	6.8%	-7.1%	-2.4%
Kings	$245,000	$235,000		$230,000		4.3%	6.5%	-7.7%	-11.1%
Madera	$268,000	$259,000		$274,900	r	3.5%	-2.5%	-1.1%	-24.9%
Merced	$275,000	$262,000		$250,100		5.0%	10.0%	9.7%	15.2%
Placer	$510,000	$499,650		$472,000		2.1%	8.1%	4.9%	-3.0%
Sacramento	$375,000	$375,000		$347,000		0.0%	8.1%	-0.2%	-3.3%
San Benito	$570,400	$579,900		$535,000		-1.6%	6.6%	-23.1%	-12.3%
San Joaquin	$377,150	$367,855		$340,000		2.5%	10.9%	0.5%	-15.2%
Stanislaus	$320,000	$325,000		$289,000		-1.5%	10.7%	1.0%	-6.9%
Tulare	$234,500	$234,950		$225,450		-0.2%	4.0%	0.3%	-5.6%
Other Calif. Counties
Amador	NA	$331,500		$337,500		NA	NA	NA	NA
Butte	$323,000	$324,100		$306,500		-0.3%	5.4%	15.1%	7.3%
Calaveras	$313,000	$329,000		$310,000	r	-4.9%	1.0%	-21.5%	-8.1%
Del Norte	$312,500	$214,000		$165,000		46.0%	89.4%	15.8%	69.2%
El Dorado	$525,000	$552,000		$499,000		-4.9%	5.2%	9.4%	-4.7%
Humboldt	$331,250	$314,900		$302,500		5.2%	9.5%	18.6%	24.1%
Lake	$298,800	$263,400		$259,500		13.4%	15.1%	1.2%	-16.3%
Lassen	$212,000	$215,000		$195,000		-1.4%	8.7%	-24.1%	-8.3%
Mariposa	$311,000	$324,500		$300,000		-4.2%	3.7%	28.6%	-5.3%
Mendocino	$449,000	$420,000		$445,000		6.9%	0.9%	21.1%	46.8%
Mono	$570,000	$852,500		$482,850		-33.1%	18.0%	30.0%	30.0%
Nevada	$452,000	$404,000		$380,000		11.9%	18.9%	33.1%	4.5%
Plumas	$290,000	$310,000		$297,000		-6.5%	-2.4%	-35.9%	-51.9%
Shasta	$281,500	$264,000		$269,900		6.6%	4.3%	12.2%	-1.3%
Siskiyou	$187,500	$210,000		$235,000		-10.7%	-20.2%	-8.0%	-2.1%
Sutter	$315,000	$281,000		$277,000		12.1%	13.7%	1.1%	-3.1%
Tehama	$234,900	$197,500		$187,500		18.9%	25.3%	28.6%	-6.3%
Tuolumne	$318,500	$300,000		$287,000		6.2%	11.0%	26.0%	5.7%
Yolo	$450,000	$476,500		$445,000		-5.6%	1.1%	-5.0%	-18.2%
Yuba	$292,500	$297,500		$275,470		-1.7%	6.2%	-5.9%	-27.3%

r = revised

NA = not available

June 2018 County Unsold Inventory and Time on Market (Regional and condo sales data not seasonally adjusted)

June 2018	Unsold Inventory Index				Median Time on Market
State/Region/County	June 2018	May 2018	June 2017		June 2018	May 2018		June 2017
Calif. Single-family home	3.0	3.0	2.7		15.0	15.0		15.0	r
Calif. Condo/Townhome	2.3	2.3	2.2		13.0	13.0		14.0	r
Los Angeles Metro Area	3.3	3.4	2.9		20.0	20.0		20.0	r
Inland Empire	3.7	3.6	2.9		25.0	27.0		23.0	r
San Francisco Bay Area	2.0	2.0	1.8		13.0	12.0	r	14.0	r

San Francisco Bay Area
Alameda	1.5	1.6	1.6		12.0	11.0		13.0	r
Contra Costa	2.0	2.0	1.9		12.0	11.0		12.0	r
Marin	2.5	2.5	2.4		28.0	21.0		29.0	r
Napa	4.8	4.5	3.8		34.0	33.5		44.0	r
San Francisco	1.4	1.5	1.7		13.0	14.0		15.5	r
San Mateo	1.7	1.6	1.3		11.5	11.0		11.0	r
Santa Clara	1.7	1.6	1.4		9.0	8.0		9.0	r
Solano	2.6	2.5	2.3		32.0	27.0		32.0	r
Sonoma	3.4	3.1	2.7		34.0	31.0		35.5	r
Southern California
Los Angeles	2.6	3.1	2.7		17.0	15.0		16.0	r
Orange	3.2	3.3	3.0		15.0	15.0		18.0	r
Riverside	3.5	3.4	2.8		26.0	27.0		23.0	r
San Bernardino	3.9	3.8	2.9	r	25.0	26.0		22.0	r
San Diego	2.8	2.9	2.5		13.0	13.0		11.0	r
Ventura	1.5	5.2	4.1		40.0	42.0		42.0	r
Central Coast
Monterey	3.5	3.3	3.5		15.0	16.0		19.0	r
San Luis Obispo	3.5	3.7	3.8		22.0	20.0		16.0	r
Santa Barbara	4.0	4.6	3.7		20.0	17.0		21.5	r
Santa Cruz	3.0	2.8	2.9		13.0	12.0		16.0	r
Central Valley
Fresno	2.7	2.7	2.6	r	13.0	11.0		13.0	r
Glenn	6.3	2.7	3.6		18.5	21.0		21.0	r
Kern	3.0	2.8	2.9		18.0	21.0		19.0	r
Kings	3.1	2.9	2.7		19.5	13.5		21.5	r
Madera	4.0	3.8	3.8	r	27.0	24.0		17.0	r
Merced	2.8	3.0	3.0		15.0	23.0		15.0	r
Placer	2.4	2.5	2.3		14.0	10.0		12.0	r
Sacramento	2.3	2.2	2.0		10.0	9.0		9.0	r
San Benito	2.7	2.2	3.1		11.5	15.0		18.0	r
San Joaquin	2.6	2.6	2.2		13.0	12.0		13.0	r
Stanislaus	2.7	2.6	2.5		12.0	12.0		12.0	r
Tulare	3.2	3.2	3.1		23.0	26.0		23.0	r
Other Calif. Counties
Amador	NA	5.2	5.6		NA	31.0		21.0	r
Butte	2.9	3.4	3.0		16.0	11.0		12.0	r
Calaveras	6.0	4.6	5.4		29.0	30.0		29.0	r
Del Norte	6.4	7.3	13.0		108.0	99.0		215.0	r
El Dorado	4.2	4.1	4.1		21.0	25.0		20.0	r
Humboldt	5.1	5.9	5.1		19.0	22.0		12.0	r
Lake	6.2	6.1	4.9		40.0	35.0		22.0	r
Lassen	8.9	6.1	7.2		69.0	97.0		68.0	r
Mariposa	4.7	6.7	4.2		18.5	45.0		33.0	r
Mendocino	7.1	8.4	7.1		74.0	74.0		54.0	r
Mono	7.6	8.3	11.7		82.0	81.5		122.0	r
Nevada	3.9	4.9	3.5		17.0	16.0		13.0	r
Plumas	11.7	8.4	7.3		50.0	129.0		88.5	r
Shasta	4.0	4.4	3.8		24.0	17.0		15.0	r
Siskiyou	7.1	6.0	6.2		24.5	16.0		31.0	r
Sutter	2.5	2.2	2.5		19.0	11.0		12.0	r
Tehama	4.8	6.0	4.8		61.0	43.0		42.0	r
Tuolumne	4.8	5.2	5.3		17.0	24.0		31.0	r
Yolo	2.3	2.0	2.0		11.0	9.0		11.0	r
Yuba	3.3	2.8	2.0		14.5	10.0		12.0	r

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