Tuesday, August 28, 2007

Home sales still weak, in California and throughout country

Author: boored
Category: Real Estate

Three real estate industry groups that would dearly love to have good news instead issued a trio of reports on Monday that underscored the continued weakness in the housing market, both for California and the nation.

California sales: The California Association of Realtors said sales of existing homes in the state slumped 22.7 percent in July compared with July 2006. The 350,980 homes (seasonally adjusted) that closed escrow in July contrasted with 453,980 last year at this time.

The group said that both tighter standards for mortgage underwriting and “the adverse psychological impact” of ongoing bad news about foreclosures and subprime mortgages caused sales to decline.

The association said it would take 10.7 months to sell all the homes currently on the market in California at today’s sales rate. That’s a significant jump from last July, when there were 7.3 months worth of inventory on the market.

“With credit drying up in recent weeks, we expect further weakness in sales over the next few months,” Leslie Appleton-Young, the trade group’s chief economist, said in a statement.

The group showed the statewide median price as $586,030, up 3.2 percent from 567,860 last July. It attributed the higher median to a softness in entry-level sales and more strength among higher-priced sales.

In the Bay Area, the group said sales volume was down 9.8 percent from last year, while the median price was $841,660, up 6.9 percent from $787,540 last July. The group defines the Bay Area as Alameda, Contra Costa, Marin, San Francisco, San Mateo, Santa Clara and Solano counties, omitting Sonoma and Napa.

California new-home construction: The California Building Industry Association said housing starts in the state were down 22 percent in July compared to July 2006 as builders and lenders wait for the market to signal a good time to move forward.

Builders pulled permits for 5,675 single-family homes statewide in July, down 32.5 percent from last July. Multifamily housing starts for both condos and apartments were up 4 percent to 3,355.

From January through July, builders started production on 73,339 homes, condos and apartments, down 32 percent from the same seven months last year. Permits for single-family homes were down 35 percent; those for multifamily units were down 23 percent.

The smaller decline in multi-family housing “relates in part to the startup of several major rental apartments projects on land once destined for condominiums, Alan Nevin, chief economist for CBIA, said in a statement. “The inventory of new single-family units has also continued to decline, placing developers in a situation where in many cases, they are maintaining a minimum number of homes under construction.”

National home sales: The National Association of Realtors said 5.75 million existing homes (seasonally adjusted) were sold in July, a drop of 9 percent from 6.32 million in July 2006. The volume was down 0.2 percent from June, the fifth consecutive month of declines. The number includes single-family, townhomes, condos and co-ops.

The median home price fell for the 12th consecutive month, to $228,900. That was down 0.6 percent from last July’s record median of $230,200.

Looking at just existing single-family homes, sales of 5 million units in July were down 9.3 percent from last July, and the median price was $228,600, a 1 percent drop from last year.

Sales of existing condos and co-ops were at 750,000, down 7.5 percent from last July.

The sales slump was most pronounced in the Western United States, where the 1.12 million existing homes sold represented a 15.2 percent decline from a year ago.

In the Northeast, sales were 2.9 percent lower than in July 2006. They were down 10.7 percent in the South and 5.6 percent in the Midwest.

Nationwide, the group said, inventory of existing homes stood at 9.6 months in July, the highest level in 16 years.

 

Real estate slump continues

Three reports show housing statistics down in July, compared with July 2006.

– California home sales dropped 22.7 percent.

– California home starts dropped 22 percent

– National home sales fell 9 percent.

Sources: California Association of Realtors, California Building Industry Association, National Association of Realtors

Source:

http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2007/08/28/BU6ERQ7V4.DTL&hw=real+estate&sn=005&sc=724

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