New-home sales dropped 31.1 percent in 2007 compared to the prior year in California and the median price of new homes dropped 3.8 percent, the California Building Industry Association and Hanley Wood Market Intelligence reported today.
The median price for all types of new homes fell more than 10 percent year-over-year in six metro areas tracked in the report. Prices dropped most dramatically in the Santa Rose-Petaluma, Calif., metro area, falling 20.2 percent in 2007 compared to the prior year.
The median new-home price dropped 15.1 percent in the Santa Cruz-Watsonville metro area, 13.5 percent in the Oxnard-Thousand Oaks-Ventura area, 11.7 percent in the Merced area and 10.6 percent in both the Madera and Fresno areas from 2006 to 2007.
Prices rose 13.1 percent in the Colusa County and Glenn County area, 11.7 percent in the Chico area and 7.3 percent in the Santa Ana-Anaheim-Irvine area in 2007 among all new-home types.
The statewide median new-home price was $434,990 in 2007, and there were 61,861 total home sales.
Median prices for single-family new homes dropped 5.7 percent statewide in 2007, to $434,900, and fell 20.8 percent in the San Francisco area, 17.4 percent in the Santa Rosa area, 11.7 percent in the Ventura area, 11.2 percent in the Merced area and 10.6 percent in the Fresno area in 2007 compared to 2006.
Single-family median new-home prices grew 9.5 percent in the Colusa County-Glenn County area, 7.4 percent in the Oakland area and 3.6 percent in the San Jose area, CBIA and Hanley Wood reported.
The California Association of Realtors, meanwhile, reported that the statewide median price for single-family detached resale homes was $558,100 in 2007, which represents a 0.3 percent increase from 2006. Annual sales dropped 26 percent to 353,290 in 2007, the Realtor group also reported.
For the month of December 2007, the association reported a 16.5 percent year-over-year drop in the price of existing single-family resale homes, and a 33.4 percent drop in sales.
CBIA and Hanley Wood reported that December 2007 sales of new homes in the state sunk 66.8 percent compared to December 2006 sales, with the median new-home price for all home types falling 14.2 percent. The median new-home price dropped 40.8 percent in the Chico area in December 2007 compared to December 2006, dropped 38.4 percent in the Ventura area, 29.6 percent in the Los Angeles Area, 25.5 percent in the Merced area and 20.2 percent in the Madera area.
And the median new-home price rose 13.8 percent in the Salinas area year-over-year in December 2007, rose 9.2 percent in the Napa area, 5.8 percent in the Oakland area, 4.9 percent in the San Francisco area and 4.6 percent in the Anaheim area.
Jonathan Dienhart, director of published research for research company Hanley Wood Market Intelligence, said in a statement that the new-home sales decline for the full year in 2007 “is likely the largest annual decrease we will see during this downturn” and that by March there may be a clearer picture of the state of the market.
Robert Rivinius, CBIA president and CEO, said in a statement the federal stimulus package signed by President Bush earlier this week should assist California home buyers, though “more needs to be done. Congress should make the conforming loan increases permanent, and consider further stimulus ideas, such as the tax credit for new-home buyers that helped jumpstart the recovery from a housing slowdown in the 1970s.”
He also encouraged state legislators to enact reforms to aid builders, such as longer lead times to begin new-construction projects in light of the ailing economy.