Inventories of existing single-family homes in California are dwindling, reaching just four months of supply as the sales pace picked up from September to October, the California Association of Realtors reported.
Home sales historically trail off during the fall and winter months, CAR said, but affordable home prices, low mortgage rates, and the extension and expansion of the federal homebuyer tax credit are expected to drive home sales through the end of the year and into early 2010.
Existing single-family detached homes sold at a seasonally adjusted annual rate of 562,400 in October, up 5.9 percent from September and 1 percent from a year ago, the group said.
The months supply of inventory fell from 4.2 months in September and 6.1 months a year ago. A 6-month supply of inventory is about what analysts consider an even balance between supply and demand.
It took a median of 34.1 days on market to sell a home in California in October 2009, compared with 45.5 days for the same period a year ago. At $297,500, median home price was essentially unchanged from September, but down 3.2 percent from a year ago.
Although the $890 increase in median price from September to October amounted to 0.3 percent, it was the eighth consecutive monthly gain. CAR Chief Economist Leslie Appleton-Young cited that trend, along with continued strength in sales, as "signs that California has hit and passed the bottom of this real estate cycle."
For the first-time since July 2007, she said, sales of homes priced $1 million or more rose in year-to-year comparisons, and the number of distressed sales as a share of total sales has shown considerable improvement since the beginning of the year.
Loan modifications and other efforts to keep homeowners out of foreclosure has led to a decline in inventory levels since the start of the year.
A separate report on localized statistics generated by CAR and DataQuick Information Systems showed median home prices were up from a year ago in 78 of 391 markets.
Cities with the greatest median home price increases were Palo Alto (49.1 percent), Atascadero (33.3 percent), Cupertino (24.2 percent), San Rafael (24 percent), Emeryville (22.2 percent), Livermore (20.5 percent), Culver City (19.4 percent), Pleasant Hill (17 percent), La Habra (16.2 percent), and Novato (15.4 percent).
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