Monday, June 27, 2005

California Median Home Price Rises

The median price of an existing home in California in May increased 12.8 percent and sales decreased 2.1 percent compared with the same period a year ago, the California Association of REALTORS(R) (C.A.R.) reported today.

"The California housing market passed an important threshold in April, when the median price rose above $500,000 for the first time," said C.A.R. President Jim Hamilton. "This trend continued in May, with the median price approaching $525,000. At these prices, eroding affordability and concerns about rising interest rates are constraining sales."

Closed escrow sales of existing, single-family detached homes in California totaled 618,920 in May at a seasonally adjusted annualized rate, according to information collected by C.A.R. from more than 90 local REALTOR(R) associations statewide. Statewide home resale activity decreased 2.1 percent from the 632,380 sales pace recorded in May 2004.

The statewide sales figure represents what the total number of homes sold during 2005 would be if sales maintained the May pace throughout the year. It is adjusted to account for seasonal factors that typically influence home sales.

The median price of an existing, single-family detached home in California during May 2005 was $522,590, a 12.8 percent increase over the revised $463,320 median for May 2004, C.A.R. reported. The May 2005 median price increased 2.5 percent compared with April's revised $509,630 median price.

"Inventory levels, which have been at or above three months since July 2004, fell below three months beginning in March and have ranged between 2.6 and 2.8 months since that time," said C.A.R. Vice President and Chief Economist Leslie Appleton-Young. "While not at the record low levels we experienced earlier last year, the tight inventory of homes for sale has impacted sales over the past couple of months."

-- Thirty-year fixed mortgage interest rates averaged 5.72 percent during May 2005, compared with 6.27 percent in May 2004, according to Freddie Mac. Adjustable mortgage interest rates averaged 4.23 percent in May 2005 compared with 3.88 percent in May 2004.

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