California home sales hit a seven-month low in August, according to new data from the California Association of Realtors (CAR).
Last month, the state recorded a seasonally adjusted annualized rate of 262,050 in closed escrow sales of existing, single-family detached homes. This represented a 6.3% decline from the 279,810 homes sold in July, although the total was also 2.8% above the revised 254,820 homes sold in August 2023.
The sales pace for August remained below the 300,000-threshold for 23rd consecutive month, while year-to-date home sales edged up 0.5% from the first eight months of 2023.
“Despite a slightly better lending environment in recent weeks, closed home sales pulled back in August as buyers evaluated whether to wait for the Federal Reserve to cut rates before entering the market,” said CAR Senior Vice President and Chief Economist Jordan Levine. “Pending sales, along with mortgage application trends, however, suggest that housing demand has been slowly improving in the past few weeks. If mortgage rates remain at their current low or dip further in the coming weeks, home sales should rise steadily as we move toward the end of the year.”
While home sales stalled, the statewide median price remained flat with only a 0.2% uptick from $886,560 in July to $888,740 in August. The median home price was also 3.4% higher than the revised $859,670 recorded in August 2023. The year-over-year gain was the 14th straight month of annual price increases, although it was the smallest rise since September 2023.
“Home price growth in California continued to moderate in August as the market neared the end of the traditional home buying season,” said CAR President Melanie Barker, a Yosemite realtor. “With the Federal Reserve signaling it will lower interest rates soon, mortgage rates are expected to ease well below their recent peaks. As such, housing affordability will improve in the fall, and buyers will benefit from lower costs of borrowing in the coming months.”
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