The California Association of Realtors has reported that pending home sales throughout the state have fallen when comparing month-to-month data, but remain strong when compared to last year’s figures.
Pending Home Sales in California
While pending home sales fell when comparing August to July data, California has experienced the tenth month in a row during which the state has experienced year-over-year gains. Based on signed contracts, Pending Home Sales in August fell 8.7 from 112.8 in August from 123.6 in July. When compared to August of last year, however, the index increased by 12.8 percent. This represents the seventh consecutive month of double-digit growth when compared to the prior year’s data.
When examining regional data, pending sales were higher a year-over-year basis in several specific parts of the state while falling when on a monthly basis. These regions included the Southern California, Central Valley and San Francisco Bay areas. Overall, pending home sales in Southern California dropped 13.7 percent from July with an August index of 94.3. Compared to last year, these figures were up 14.7 percent.
While pending home sales dropped, the share of equity sales, or non-distressed property sales, increased in August. These sales made up 93.8 percent of all home sales in August, representing an increase from 93.3 percent in July and 91.6 percent in August 2014. The August figures represent the highest these numbers have been since the fall of 2007. On the other end of the spectrum, the combined share of all distressed properties fell to 6.2 percent of total sales in August. This is down from 6.7 percent in July and 8.5 percent in August 2014.
Pricing Homes in California
While pending home sales have experienced a boost when comparing year-to-year data, the number of sales closing at below asking price increased to 48 percent in August. Conversely, the percent of those that closed above asking price was at 27 percent while those that closed at asking price was at 25 percent.
The California Association of Realtors further reports that the state saw a drop in the number of sales with multiple offers when compared to data from July. This is likely due to the fact that market competition tends to cool down near the end of the home buying season. In July, the average number of offers per property was 3 while the average was 2.5 in August. This year, the figure came in at 2.4.
The figures collected for August seem to coincide with the feedback that California Realtors are providing. In a monthly online survey involving more than 300 Realtors, 22 percent indicated that their biggest concern was low housing affordability. Meanwhile, 18 percent said they were concerned about overinflated home prices while another 18 percent expressed concern about the shortage of housing inventory.
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(all data current as of 11/24/2017)
Listing information deemed reliable but not guaranteed. Read full disclaimer.