Double-digit gain in annual pending home sales suggests market will continue its upswing coming months, C.A.R. reports
Pending sales in San Francisco Bay Area, Southern California, and Central Valley regions jump
LOS ANGELES (April 22) – California pending home sales jumped in March to record three straight month-to-month and year-to-year sales increases, portending a solid upcoming spring home-buying season, the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) said today.
Pending home sales in the San Francisco Bay Area, Southern California, and Central Valley regions also posted back-to-back, double-digit monthly gains compared to February.
Pending home sales data:
- California pending home sales propelled higher in March, with the Pending Home Sales Index (PHSI)* increasing 16.3 percent from a revised 111.9 in February to 130.2, based on signed contracts. The month-to-month increase was essentially unchanged from the long-run average increase of 16.8 percent observed in the last seven years.
- Statewide pending home sales were up 13.8 percent on an annual basis from the 114.4 index recorded in March 2014. The yearly increase was the second largest since April 2009 and was the fourth consecutive annual gain.
- San Francisco Bay Area’s PHSI stood at 146.6 in March, up 17.4 percent from 124.8 in February and up 7.2 percent from 136.7 percent in March 2014.
- Pending home sales in Southern California rose 16.7 percent in March to reach an index of 115.4, up 15 percent from 100.3 in March 2014.
- Central Valley pending sales increased 21.7 percent from February to reach an index of 100.8 in March, up 15.3 percent from 87.5 in March 2014.
Equity and distressed housing market data:
- The share of equity sales – or non-distressed property sales – climbed in March to make up 91 percent of all home sales, up from 89.1 percent in February and 87.5 percent in March 2014. Equity sales have been more than 80 percent of total sales since July 2013 and have risen to or near 90 percent since mid-2014.
- Conversely, the combined share of all distressed property sales fell in March, down from 10.9 percent in February to 9 percent in March. Distressed sales made up 12.5 percent of total sales a year ago. Thirty-four of the 43 counties that C.A.R. reported showed month-to-month decreases in their distressed sales shares, with Mariposa having the smallest share of distressed sales at 0 percent, followed by San Mateo (1 percent) and Marin, San Francisco, and Santa Clara (all at 2 percent). Plumas County had the highest share of distressed sales at 27 percent, followed by Siskiyou (24 percent), and Kings (21 percent).
March REALTOR® Market Pulse Survey**:
In a separate report, California REALTORS® responding to C.A.R.’s March Market Pulse Survey saw slightly more multiple offers than the previous month and an increase in floor calls, listing appointments, and open house traffic. The Market Pulse Survey is a new monthly online survey of more than 300 California REALTORS® to measure data about their last closed transaction and sentiment about business activity in their market area for the previous month and the last year.
- In a sign of sellers pricing their homes more in line with market conditions, the percentage of properties selling above asking price dropped from its peak in March 2014 at 40 percent to 25 percent a year later. However, the share was up from the lowest point of 16 percent in February. Nearly half of homes (48 percent) closed below asking price.
- The premium paid over asking price declined in March, indicating sellers’ and buyers’ expectations are more in line. In March, homes that sold above asking price sold for 7.5 percent above asking price, down from 10 percent in February, and essentially flat from 7.6 percent in March 2014.
- Homes that sold below asking price sold for 11 percent below asking price in March, unchanged from February. The number of homes that had listing price reductions dropped from 31 percent in February to 22 percent in March.
- Sixty-three percent of properties received multiple offers in March, up from 61 percent in February but down from 74 percent a year ago.
- The average number of offers per property in March was 2.6, unchanged from February but down from 3.2 a year ago.
- Floor calls, listing appointments, and open house traffic were all up in March, compared to both the previous month and year, suggesting the market will continue its upswing in closed escrow sales.