The rate rose to 6.83% from 6.62% last week, mortgage buyer Freddie Mac said Thursday. A year ago, the rate averaged 7.1%.

Borrowing costs on 15-year fixed-rate mortgages, popular with homeowners refinancing their home loans, also rose. The average rate increased to 6.03% from 5.82% last week. It’s still down from 6.39% a year ago, Freddie Mac said.

Mortgage rates are influenced by several factors, including global demand for U.S. Treasurys, the Federal Reserve’s interest rate policy decisions and bond market investors’ expectations for future inflation.

The average rate on a 30-year mortgage loosely follows moves in the 10-year Treasury yield, which lenders use as a guide to pricing home loans.

The yield, which had mostly fallen this year after climbing to around 4.8% in mid-January, spiked last week to 4.5% amid a sell-off in government bonds triggered by investor anxiety over the potential fallout from the Trump administration’s escalating tariff war.

The 10-year Treasury yield was at 4.32% in midday trading Thursday.

When mortgage rates rise, they reduce homebuyers’ purchasing power.

The average rate on a 30-year mortgage had mostly trended lower since reaching just over 7% in mid-January. This week’s increase is the first after three straight declines and brings the average rate to its highest level since Feb. 20, when it was 6.85%.

The increase in mortgage rates may put off some would-be homebuyers during what’s traditionally the busiest period of the year for home sales. Last week, mortgage applications fell 8.5% from a week earlier, according to the Mortgage Bankers Association.

At the same time, the share of applications for adjustable-rate mortgages, or ARMs, climbed to its highest level in 17 months. ARMs lower a borrower’s mortgage payment by reducing the interest rate on a mortgage for a preset number of years before it adjusts to a higher rate.

Earlier this year, forecasts by housing economists generally called for the average rate on a 30-year mortgage to remain around 6.5% this year.

“Looking forward, competing economic forces are pulling mortgage rates in opposite directions, making it increasingly difficult to predict where they’ll land,” said Jiayi Xu, an economist at Realtor.com. “For buyers, the smartest move is to stress-test their budgets across a range of possible rate scenarios to stay prepared—no matter which way the winds shift.

The U.S. housing market has been in a sales slump since 2022, when mortgage rates began to climb from pandemic-era lows. Sales of previously occupied U.S. homes fell last year to their lowest level in nearly 30 years.

Easing mortgage rates and more homes on the market nationally helped drive sales higher in February from the previous month, though they were down year-over-year.

Home shoppers who can afford to buy at current mortgage rates may benefit from more buyer-friendly trends this spring homebuying season, including a sharp increase in home listings and lower asking prices in some metro areas.

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The upbeat findings were part of the annual “Southern California Economic Update” published by the Southern California Association of Governments.

“The outlook for the near-term future is positive for the Inland Empire,” Chief Economist for the Inland Empire Economic Partnership Manfred Keil said. “First, steady growth in the U.S. economy is expected over the next six to 18 months, driving increases in spending. Second, migration to the region will increase as households move from the coastal areas and elsewhere in search of more favorable housing costs, which will trigger continued growth in population-serving industries such as healthcare, retail trade and leisure and hospitality services.”

Keil joined SCAG Executive Director Kome Ajise and others for an Economic Roundtable in Riverside Thursday to spotlight key points from the SCAG report.

“The risk of recession is sharply lower than it was a year ago,” Ajise said. “Consumers continue to drive the state and regional economies with their spending, and business investment in equipment and software is sharply higher. This should extend into 2025 as interest rates soften.”

Analysts said significant developments in logistics, healthcare and energy projects, along with steadily increasing tourism, will result in economic positives over the coming year. Labor growth and capital investment are assured.

“Housing construction and sales should rebound as the cycle of interest rates turns lower,” according to the report.

The Inland Empire ranks as the 12th largest metropolitan statistical area nationwide, within 200,000 residents of the Boston-Cambridge MSA, which is ranked No. 11.

“Challenges remain,” the report stated. “Comparing wages to gross domestic product, the Inland Empire ranks 300th out of 390 MSAs. Also, proposed hefty tariffs on imported goods, in particular from China, could reduce imports and negatively impact the region’s logistics industry.”

The full report is available at scag.ca.gov/news/2024-southern- california-economic-update-now-available-online.

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Oliver Povey | Contributor

The covid-19 pandemic was a great year for homeowners. Prices soared, encouraged by record-low interest rates. This was as true in California compared to any other state, despite having some of the highest average prices in the country even before 2020. According to Zillow, prices peaked at more than $771,000 in July of last year. Staggeringly for buyers, homes have increase by an average price of $210,000 since April 2018.

But a smidge of good news could be coming Californian home-buyers way. The average house price has dropped in the last year, falling 1.7% since April 2022 to stand at $728,134.

Home prices are likely to continue falling. The median cost of existing-homes in the country fell in February for the first time in more than ten years. Prices are expected to fall nationally by 5% with the bulk of the price falls to happen in expensive areas, affecting California greatly.

“We’re estimating about a 5% drop nationally,” says Rick Sharga, executive vice president of market intelligence at ATTOM Data.

A big shake-up could be underway on the Pacific coast. Investment bank Goldman Sachs advised clients in a January letter that four US cities will see a major boom-to-bust comparable to that experienced during the 2008 housing bubble. At that time, across the US home prices tanked around 27% according to the S&P CoreLogic Case-Shiller index leading to the Great Recession.

Two of these cities are in California; strategists from the bank forecast homes in San Jose and San Diego could lose about 25% of their value.

Instability with the FED and inflation likely to affect housing prices

These price reductions are in part a consequence of the higher interest rates encouraged by the Federal Reserve. Consistent rate increases, with another set for May, make it less encouraging to borrow money, a crucial aspect of home buying unless you are very rich.

Less people are buying houses, or are less willing to pay so much knowing their repayments will be larger. This is echoed in data provided by Zillow which shows more than half of homes in California being sold under their listed prices last year as well as existing-home sales being down 22.6% nationally on a year prior.

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Tim Smart | Contributed

A year ago, the housing market was on a roll. Sales of existing homes rose 7% in September from the prior month, reaching an annual pace of 6.29 million.

Prices of a median home, meanwhile, were up 13.3% from a year earlier. This week, the housing market will see a new round of economic data for September and the picture is vastly different.

On Thursday, the existing home sales report is expected to show sales have fallen to 4.7 million annually – a drop of 25%. The culprit? An aggressive program of interest rates from the Federal Reserve designed to arrest inflation that has led to mortgage rates of 7%, more than double a year ago.

Other measures of housing activity – including building permits and new construction starts – are expected to show declines of 0.8% and 7%, respectively. “The shortage of inventory, combined with affordability challenges continue to weigh on the housing market,” Sam Bullard, managing director and senior economist at Wells Fargo’s corporate and investment banking unit, wrote on Sunday.

“Home prices are beginning to contract sequentially, a trend we believe will continue in 2023, with nation-wide home prices falling about 5.5%.” Along with the rise in gasoline and food prices throughout much of the year, the deterioration in the housing sector is the economic trend most likely to be felt by consumers, especially among higher-income households.

Following the arrival of the coronavirus pandemic in March 2020, prices of assets such as homes and stocks rose sharply as Washington poured money into the economy and interest rates fell to historic lows. Year-over-year gains in home prices reached close to 20% on average and even more than that in some Sun Belt markets such as Arizona, Southern California and Florida, at 30%.

But that trend began to reverse itself earlier this year as the Fed signaled an about-face on its easy money policies and fiscal stimulus dried up. Inflation accelerated following the Russian invasion of Ukraine in late February. The overall economic picture is now one of higher prices and increased borrowing costs.

“At today’s rates and home prices, buyers who purchase a home are paying about 80% more for the same house than if they had bought at the same time last year, “ Realtor.com noted on its site on Saturday. “People who’ve been looking diligently over the last six months are frustrated because they’ve experienced in real time the shock,” mortgage lender Shmuel Shayowitz, of Approved Funding in River Edge, New Jersey, told the site.

“Anybody who really doesn’t need to buy or isn’t in a rental squeeze where their rent continues to rise, they’ve pulled back [from purchasing homes].” While much of the public angst over the economy has centered on rising prices, it is the prospect of declining prices for homes and stocks (down 25% from a year ago) that could be equally bad for the economy as home purchases tend to lead to more spending on related items like appliances, furniture and flush investment accounts also lead to spending on travel and even homes themselves.

While consumer spending has held steady, it has declined when inflation is taken into account and there has been a noticeable shift in spending away from goods to services such as health and personal care. The week’s economics news concludes with the release of the leading economic indicators on Thursday. Forecasts are for a monthly drop of 0.3%.

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While buying a home continues to be competitive in California’s top housing markets, record-breaking housing prices are stabilizing, supply is improving, and competition is showing signs of easing up. This is the time to make your move, and Golden 1 Credit Union is here to help!

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Golden 1 | Contributed

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Californians — particularly politicians and we in the media — talk a lot about the state’s housing crisis and how it could be resolved.

Simply put, we haven’t been building enough to meet the demand, even though the state’s once-robust population growth has slowed to a near-standstill, and the supply-demand mismatch drives up costs for both renters and would-be homeowners.

High housing costs are the major reason California has the nation’s highest rate of functional poverty and the second lowest rate of home ownership, just ahead of New York.

If anything, the pandemic has exacerbated the crisis. Distress among renters, many of whom suffered job losses, has increased while home prices have risen dramatically, with a median second only to Hawaii’s. Although the housing shortage has received much media and political attention in recent years, it actually has been developing for decades, despite periodic spurts of production, as a new report from the Public Policy Institute of California underscores.

Citing data from the 2020 Census, PPIC researchers calculated that “the state added 3.2 times more people than housing units over the last 10 years. There are now 2.93 Californians for every occupied housing unit, behind only Utah (3.09) and Hawaii (2.93), and far above the average of all other states (2.53).”

“Though coastal housing is the most expensive, the biggest percent change in housing values has actually occurred in inland regions,” PPIC continues. “To avoid higher coastal prices, many residents have moved to the Central Valley, east of the Bay Area, and the Inland Empire east of Los Angeles. In the process, they have driven up prices in their new neighborhoods as well.”

The PPIC report cites a 2015 study by the Legislative Analyst’s Office that delved into the underlying reasons for the housing crisis. The LAO said that to avoid extreme cost increases, the state should have been building at last 70,000 more units a year, and perhaps as many as 110,000, from 1980 to 2010. It estimates the shortfall over that 30-year period at about 3.5 million units.

Gavin Newsom cited that figure while running for governor in 2018 and pledged that the gap would be closed by 2025. It was a fanciful promise, requiring construction to roughly quintuple to a half-million units a year, but if anything it has remained static or even declined.

“Average annual production has actually slowed, from 147,000 per year in the first decade of the century to just 71,000 per year since,” PPIC notes. “Construction dropped almost everywhere, but the drop was larger outside the expensive coastal counties (Los Angeles, Orange, and San Diego, as well as the Bay Area). And while the pace has picked up recently, it is not enough to overcome the years of lag.”

The state’s official housing production goal is 180,000 units a year and the Department of Housing and Community Development imposes numerical quotas on regions, which then become quotas on local governments, to zone enough land for their projected needs.

The department recently gained new powers to enforce its quotas and to block cities from bowing to local opposition to specific developments. The current state budget also boasts of spending $10 billion to spur housing for low-income families and another $7 billion to battle homelessness.

“These changes signal a more pro-housing stance, but it remains to be seen whether they are enough to boost production to the levels many consider necessary,” PPIC concludes.

There are no magic solutions. Given the scope of the crisis and decades of construction shortfalls, making even marginal progress would be nothing short of miraculous.

Dan Walters | Calmatters

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The U.S. housing market is in the midst of an inventory crisis. The number of homes for sale in the U.S. is hovering near record lows, caused by a pandemic-induced housing inventory death-spiral.

At the same time, home sales have soared close to record highs, suggesting the housing market suffers exclusively from a supply (and not demand) problem. Thus, federal policies must focus as much on increasing housing supply as boosting demand.

Rolled out in isolation, first-time homebuyer tax incentives (FTHB) – such as the Biden Administration’s proposed $15,000 advanceable FTHB credit – are only likely to make housing inventory scarcer and prices higher. Instead of just bolstering demand, policies that focusing on increasing supply – such as tax incentives that encourage owners to sell and builders to build – is what the U.S. housing market desperately needs.

The federal government could quickly incentivize owners of existing homes to sell using one or a combination of carrot-based or stick-based approaches. Using a carrot-based approach, opening a temporary window of capital gains exemptions would incentivize owners of investment homes with capital gains, as well as owner-occupiers with over $250k-$500k in gains, to sell.

Alternatively, a stick-based approach might raise taxes on single-family rental income, implement nation-wide rent control, and/or reduce bulk ownership of single-family homes. In our current political environment, though, it seems carrot-based approaches would be much more likely to garner bipartisan support than stick-based approaches, especially given the hardship that both renters and landlords have experienced during the pandemic.

The efficacy of a carrot-based supply approach could also be heightened by combining it with the $15,000 FTHB credit in a targeted way. For example, capital-gain exclusion eligibility could be tied to the sale of a home to a first-time homebuyer. This would incentivize transfers of housing units from owners of homes with taxable gains to renters. In this way, policies would assist first-time homebuyers by helping them solve the search (supply) problem while also assisting them with the demand (affordability) problem.

This approach, however, doesn’t come without challenges. Incentivizing the conversion of rental stock to owner-occupier stock reduces the supply of rental housing. The beauty of a combined cap-gains and FTHB approach, however, is that in aggregate there would be no net loss of rental stock relative to rental demand. First-time hombeuyers who are, by definition, renting, would purchase previously rented homes or homes of long-time residents who moved elsewhere.

But the switch may not always be direct. In other words, owners of single-family rental units may not always – or even ever – sell directly to their tenants. This would create a temporary – but painful – problem for renters whose owners decided to sell since they would likely be forced to move. Assistance to state and local housing agencies could help displaced renters find new accommodation and moving-related tax breaks could help alleviate some of the financial pain of a relocation.

The federal government could also implement similar incentives for homebuilders by offering tax breaks to sellers of new homes who either sell to existing homeowners who sold to first-time homebuyers or to first-time homebuyers themselves. This would help break up congestion in the housing market by not only incentivizing home builders to cater to FTHBs, but in the case of markets where this isn’t feasible (because of high construction costs), it would also incentivize current owner-occupiers to trade up and sell their existing home to a first-time homebuyer, thus freeing up the housing inventory ladder.

In sum, providing an advanceable $15,000 FTHB credit alone is a well-intentioned policy that would likely have severe, un-intended consequences in today’s housing inventory-strangled market. However, when implemented in parallel with supply-oriented tax breaks for owners and builders, the Biden administration could help promote the largest wave of homeownership not seen in a quarter-century.

Ralph McLaughlin • Contributed

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Closed escrow sales of existing, single-family detached homes in California totaled a seasonally adjusted annualized rate of 489,590 units in September, according to information collected by C.A.R. from more than 90 local REALTOR^® associations and MLSs statewide. The statewide annualized sales figure represents what would be the total number of homes sold during 2020 if sales maintained the September pace throughout the year. It is adjusted to account for seasonal factors that typically influence home sales.

September’s sales total climbed above the 400,000 level for the third straight month since the COVID-19 crisis depressed the housing market earlier this year and was the highest sales level recorded since February 2009. September sales rose 5.2 percent from 465,400 in August and were up 21.2 percent from a year ago, when 404,030 homes were sold on an annualized basis.

“As motivated buyers continue to take advantage of the lowest interest rates in history, home sales will be elevated in the next couple of months, and the housing market should remain a bright spot in a broader economy that continues to struggle,” said C.A.R. President Jeanne Radsick, a second-generation REALTOR^® from Bakersfield, Calif. “And with many employers allowing the flexibility of working remotely, homebuyers now also have the option of searching in less expensive areas where homes are more affordable and buyers can get more home for their money.”

With home sales continuing to bounce back in September and sales of higher-priced properties recovering faster than the rest of the market, the statewide median price hit another new high after setting records in June, July and August. California’s median home price exceeded the $700,000 mark for the second consecutive month, as it reached $712,430 in September, edging up 0.8 percent from August’s $706,900 and jumping 17.6 percent from $605,680 in September 2019. The yearly price increase was the highest recorded since February 2014 and higher than the six-month average of 5.3 percent observed between March 2020 to August 2020.

“With the statewide home price hitting new highs for the past four months, it’s sounding like a broken record as California home sales and prices continue to outperform expectations,” said C.A.R. Senior Vice President and Chief Economist Leslie Appleton-Young. “However, with the shortest time on market in recent memory, an alarmingly low supply of homes for sale, and the fastest price growth in six and a half years, the market’s short-term gain can also be its weakness in the longer term as the imbalance of supply and demand could lead to more housing shortages and deeper affordability issues.”

Reflecting the rise in home prices, consumers continue to say it is a good time to sell, according to C.A.R.’s monthly Consumer Housing Sentiment Index. Conducted in early October, the poll found that 56 percent of consumers said it is a good time to sell, down from 58 percent a month ago, but up from 52 percent a year ago. Meanwhile, low interest rates continue to fuel the optimism for homebuying; 28 percent of the consumers who responded to the poll believed that now is a good time to buy a home, up from last year, when 22 percent said it was a good time to buy a home.

Other key points from C.A.R.’s September 2020 resale housing report include:

• At the regional level, sales increased in all major regions from last year in the high double-digits. The Central Coast and the San Francisco Bay Area had the strongest sales growth in September with both regions surging 42 percent and 34.2 percent, respectively. That was followed by increases in the Far North (28.3%), Southern California (25.0%), and the Central Valley (18.4%).
• More than nine out of ten counties (47 of 51) tracked by C.A.R. experienced a year-over-year gain in closed sales, with Plumas increasing the most from last year at 130.3 percent, followed by Amador (122.4%) and Mono (118.8%). Counties with an increase from last year averaged a gain of 39.2 percent. Sales fell in four counties, with Merced declining the most at 20.8 percent from last year.
• Sales in resort communities remained hot in September as housing demand in those areas continued to surge from last year. South Lake Tahoe home sales continued to increase year-over-year by triple-digits (105.4%) for the second consecutive month, while Rim O’ the World and Tahoe Sierra surged from a year ago by 107.6 percent and 73.6 percent, respectively. The flexibility to work from home and the desire to move away from metropolitan areas continued to motivate home buyers to flock to resort communities where they can get more home for their money.
• At the regional level, all major regions posted double-digit price increases from last year. The Central Coast had the highest increase in median price, rising 20.6 percent from last year, followed by the San Francisco Bay Area (20.5%), the Far North (19.0%), Southern California (15.2%), and the Central Valley (14.6%). All regions except the San Francisco Bay Area set a new high in median price in September.    
• All but one of 51 counties tracked by C.A.R. reported a year-over-year price gain, with 39 of them growing 10 percent or more. Lassen had the highest price increase, gaining 51.4 percent year-over-year. Humboldt was the only county where the median price was flat from a year ago, and no counties experienced an annual price decline.
• For-sale properties continued to be added to the market at a pace slower than normal, and housing supply remained significantly below last year’s level. The year-over-year decline of 48.4 percent in September was the fourth consecutive month with active listings falling more than 40 percent from the prior year.
• With sales remaining robust and the growth in active listing continuing its declining trend, C.A.R.’s Unsold Inventory Index (UII) dipped to the lowest level since November 2004. The UII fell sharply from 3.6 months in September 2019 to 2.0 months this September.
• Active listings continued to decline significantly in all major regions. The Central Coast had the biggest drop (-60.3%) from last September, followed by the Central Valley (-51.5%), Southern California (-49.9%), the Far North (-43.9%), and the San Francisco Bay Area (-31.9%). Forty-nine of the 51 counties reported by C.A.R. experienced a year-over-year decline in active listings in September. Santa Barbara had the biggest drop from last year (83.7%), followed by San Bernardino (65.8%) and Merced (65.7%).  Twenty-five counties had less than half the active listings they had in September 2019.  San Francisco (47.2%) and San Mateo (2.6%) continued to be the only counties in California with an increase in active listings from the prior year.    
• Housing inventory tightened by double-digits in all price segments, but the constraint was more pronounced in the affordable markets. Active listings in every price range continued to decline sharply from last year, with for-sale properties priced below $1 million falling 56 percent on a year-over-year basis. Compared to a year ago, the supply for homes priced between $1 million and $3 million declined 30.4 percent, and homes priced at or above the $3 million benchmark declined 19.4 percent.
• The median number of days it took to sell a California single-family home was 11 days in September, down from 24 in September 2019. The September 2020 figure was the lowest ever recorded.
• C.A.R.’s statewide sales-price-to-list-price ratio* was 100 percent in September 2020 and 98.5 percent in September 2019.
• The statewide average price per square foot** for an existing single-family home was $321 in September 2020 and $287 in September 2019.
• The 30-year, fixed-mortgage interest rate averaged 2.89 percent in September, down from 3.61 percent in September 2019, according to Freddie Mac. The five-year, adjustable mortgage interest rate was an average of 2.98 percent, compared to 3.38 percent in September 2019.

Note:  The County MLS median price and sales data in the tables are generated from a survey of more than 90 associations of REALTORS^® throughout the state and represent statistics of existing single-family detached homes only. County sales data are not adjusted to account for seasonal factors that can influence home sales. Movements in sales prices should not be interpreted as changes in the cost of a standard home. The median price is where half sold for more and half sold for less; medians are more typical than average prices, which are skewed by a relatively small share of transactions at either the lower end or the upper end. Median prices can be influenced by changes in cost, as well as changes in the characteristics and the size of homes sold. The change in median prices should not be construed as actual price changes in specific homes.

*Sales-to-list-price ratio is an indicator that reflects the negotiation power of home buyers and home sellers under current market conditions. The ratio is calculated by dividing the final sales price of a property by its last list price and is expressed as a percentage. A sales-to-list ratio with 100 percent or above suggests that the property sold for more than the list price, and a ratio below 100 percent indicates that the price sold below the asking price.

**Price per square foot is a measure commonly used by real estate agents and brokers to determine how much a square foot of space a buyer will pay for a property. It is calculated as the sale price of the home divided by the number of finished square feet. C.A.R. currently tracks price-per-square foot statistics for 50 counties.

Leading the way…® in California real estate for more than 110 years, the CALIFORNIA ASSOCIATION OF REALTORS^® (www.car.org) is one of the largest state trade organizations in the United States with more than 200,000 members dedicated to the advancement of professionalism in real estate. C.A.R. is headquartered in Los Angeles.

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California home sales fell to the lowest level since the Great Recession as the housing market suffered the full impact of the coronavirus pandemic in May and remained below 300,000 for the second straight month, the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) said.

Closed escrow sales of existing, single-family detached homes in California totaled a seasonally adjusted annualized rate of 238,740 units in May, according to information collected by C.A.R. from more than 90 local REALTOR® associations and MLSs statewide. The statewide annualized sales figure represents what would be the total number of homes sold during 2020 if sales maintained the May pace throughout the year. It is adjusted to account for seasonal factors that typically influence home sales.

May’s sales total was down 13.9 percent from 277,440 in April and down 41.4 percent from a year ago, when 407,330 homes were sold on an annualized basis. It was the second straight month that home sales dropped below 300,000 units. Additionally, the year-to-year drop was the largest since November 2007, contributing to a year-to-date sales drop of 12.9 percent.

“The sharp sales drop in May was the steepest we’ve seen in some time, but there are encouraging signs that show the market is recovering and should continue to improve over the next few months,” said 2020 C.A.R. President Jeanne Radsick, a second-generation REALTOR® from Bakersfield, Calif. “With pending home sales up a stunning 67 percent in May, buyer demand is on the upswing amid record-low rates that are making monthly mortgage payments $300 less than a year ago.”

As housing demand fell in May, home prices softened further, sending the statewide median home price below last year’s price for the first time since February 2012 and breaking the state’s 98-month year-over-year price gain streak. The May statewide median price of $588,070 for existing single-family homes in the state was down 3.0 percent from April and down 3.7 percent from May 2019, when the median price was a revised $610,940.

“As we predicted, May home sales took the full impact of the coronavirus pandemic as much of the state remained in lockdown during the past few months and caused three straight months of double-digit sales declines, which we haven’t experienced since the Association began reporting monthly home sales in 1979,” said C.A.R. Senior Vice President and Chief Economist Leslie Appleton-Young. “While we expect sales activity to remain below pre-COVID-19 levels, closed sales should improve markedly as the phased reopening of the economy continues and consumers feel more confident returning to the market.”

Reflecting the dramatic change in market conditions, a monthly Google poll conducted by C.A.R. in early June found 40 percent of consumers said it is a good time to sell, up from 29 percent a month ago, but down from 51 percent a year ago. The market uncertainty has not curbed the optimism for homebuying as much; 32 percent of the consumers who responded to the poll believed that now is a good time to buy a home, sharply higher than last year, when 26 percent said it was a good time to buy a home.

Other key points from C.A.R.’s May 2020 resale housing report include:

• At the regional level, all major regions dipped in sales by more than 35 percent from last year, with the Bay Area and Central Coast dropping the most at -51.1 percent each, followed by Southern California (-45.6 percent), and the Central Valley (-36.6 percent).

• Fifty of the 51 counties tracked by C.A.R. experienced a year-over-year loss in sales, with Monterey declining the most from last year at -63.0 percent, followed by Mendocino (-59.7 percent), and San Benito (-59.2 percent). Counties that experienced a sales decline from last year averaged a loss of 42.2 percent from the year prior. Del Norte was the only county with an increase from last year.

• Median prices continued to dip in May from last year in the Central Coast and the Bay Area but inched up slightly in the Central Valley region. The median home price was virtually unchanged in Southern California.

• Thirty-one of the 51 counties tracked by C.A.R. reported a year-over-year gain in price in May, with Glenn County growing the most at 31.9 percent. Of the 19 counties that experienced a price drop from last May, Plumas had the biggest decline of 23.3 percent.

• C.A.R.’s Unsold inventory Index jumped to 4.3 months in May from 3.4 months in April and was up from 3.2 months in May 2019. The index indicates the number of months it would take to sell the supply of homes on the market at the current rate of sales.

• Total active listings continued to decline on an annual basis for the 11th consecutive month; the 34 percent year-over-year decrease in listings was the biggest drop since March 2013.

• All major regions recorded a decrease in housing supply of more than 25 percent, with both the Southern California and the Central Valley regions falling by more than 33 percent. All counties in Southern California, except Ventura, declined 36 percent or more from last year, with San Diego dropping the most at 42.7 percent. The Bay Area also experienced a significant housing supply decline, but at a relatively smaller degree compared to the Southland. Eight of the nine Bay Area counties recorded a decline in active listings on a year-over-year basis in May, and six had a decrease of more than 25 percent. San Francisco was the only county in the region with an increase in active listings from last year.

• The median number of days it took to sell a California single-family home dipped to 17 days in May from 18 days in May 2019.

• C.A.R.’s statewide sales-price-to-list-price ratio* was 99.7 percent in May 2020, up slightly from 99.3 in May 2019.

• The statewide average price per square foot** for an existing single-family home was $281 in May 2020 and $292 in May 2019.

• The 30-year, fixed-mortgage interest rate averaged 3.23 percent in May, down from 4.07 percent in May 2019, according to Freddie Mac. The five-year, adjustable mortgage interest rate was an average of 3.16 percent, compared to 3.65 percent in May 2019.

The County MLS median price and sales data in the tables are generated from a survey of more than 90 associations of REALTORS® throughout the state and represent statistics of existing single-family detached homes only. County sales data are not adjusted to account for seasonal factors that can influence home sales. Movements in sales prices should not be interpreted as changes in the cost of a standard home. The median price is where half sold for more and half sold for less; medians are more typical than average prices, which are skewed by a relatively small share of transactions at either the lower end or the upper end. Median prices can be influenced by changes in cost, as well as changes in the characteristics and the size of homes sold. The change in median prices should not be construed as actual price changes in specific homes.

-CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.)

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Closed escrow sales of existing, single-family detached homes in California totaled a seasonally adjusted annualized rate of 277,440 units in April, according to information collected by C.A.R. from more than 90 local REALTOR® associations and MLSs statewide. The statewide annualized sales figure represents what would be the total number of homes sold during 2020 if sales maintained the April pace throughout the year. It is adjusted to account for seasonal factors that typically influence home sales.

April’s sales total was down 25.6 percent from the 373,070 level in March and down 30.1 percent from a year ago. It was the first time home sales dropped below the 300,000 level since March 2008, and the month-to-month drop was the largest since at least 1979, when C.A.R. began tracking this data. Additionally, the year-over-year decline was the first double-digit loss in 15 months and the largest decrease since December 2007.

“As expected, California home sales experienced the worst month-to-month sales decline in more than four decades as the coronavirus pandemic prompted stay-at-home orders, which kept both buyers and sellers on the sidelines,” said 2020 C.A.R. President Jeanne Radsick, a second-generation REALTOR® from Bakersfield, Calif. “While some economic activity will resume as the state gradually reopens, the housing market is expected to remain sluggish for the next couple of months as potential market participants deal with the impact of stay-in-place restrictions.”

While the statewide median price remained above the $600,000 benchmark for the second consecutive month in April, price growth showed clear signs of softening when compared to the past six months. The April statewide median price of $606,410 for existing single-family homes in the state dipped 1.0 percent from March, and the 0.6 percent gain was essentially flat from April 2019, when the median price was $603,030. The year-over-year price gain was substantially smaller than the six-month average gain of 7.8 percent recorded between October 2019 and March 2020.

“With the recession-level decline in closed home sales, the statewide median price was just barely able to avoid going into negative territory in April, in part because high-end homes saw the biggest sales declines,” said C.A.R. Senior Vice President and Chief Economist Leslie Appleton-Young. “Even with tight supply and low interest rates, home prices will continue to be tested by economic deterioration in the short term.”

Reflecting the dramatic change in market conditions, a monthly Google poll conducted by C.A.R. in early April found nearly one-third (29 percent) of consumers said it is a good time to sell, up from 26 percent a month ago, but down from 45 percent a year ago. The market uncertainty has not curbed the optimism for homebuying as much; 31 percent of the consumers who responded to the poll believed that now is a good time to buy a home, sharply higher than last year, when 22 percent said it was a good time to buy a home.

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