California’s housing market rebounded in May with home sales rising to the highest level in eight months and the statewide median price remaining above $800,000 for the second straight month.
According to new data from the California Association of Realtors, closed escrow sales of existing, single-family detached homes in California totaled a seasonally adjusted annualized rate of 289,460 in May, up 9.8% on a monthly basis from 263,650 in April. However, last month’s sales total was down 23.6% from a year ago, when a revised 378,640 homes were sold on an annualized basis. CAR also noted existing single-family homes were below the 300,000-unit pace for the eighth consecutive month.
California’s median home price of $836,110 in May was up 3% from April’s $811,950. On a year-over-year measurement, the median home price in California fell 6.4% from $893,200 in May 2022. The median number of days it took to sell a California single-family home was 17 days in May, compared to 11 days in May 2022.
“The bounceback in May’s home sales and price shows the resilience of California’s housing market and is a testament to the value that consumers place on homeownership,” said CAR President Jennifer Branchini, a Bay Area realtor. “The housing market is stabilizing and even showing signs of improvement as competition is on the rise again; nearly half of homes are selling above asking price, fewer sellers are reducing listing prices, and homes for sale are going into pending status in just two weeks compared to more than 30 days early this year.”
However, CAR Senior Vice President and Chief Economist Jordan Levine was somewhat more pessimistic.
“While home sales rose solidly in May, we don’t expect to see a rapid recovery because of the lock-in effect that’s keeping prospective sellers with low interest rate mortgages from listing their homes on the market and keeping inventory extremely tight,” he said. “Consequently, we expect prices to continue to rise on a month-to-month basis for the next few months because of the shortage of homes for sale. Even with reduced homebuyer demand, California still has more homebuyers than homes to put them in. It is this imbalance between supply and demand that continues to put upward pressure on home prices and nudge the median price up month over month since the beginning of the year.”
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