Tulare County home prices rise while buyers drop off

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Tulare County, state housing market continues downward trend as prices are up but sales are down

By Reggie Ellis
@Reggie_SGN

TULARE COUNTY – The local housing market has slowed in the last few months, a bad sign for both buyers and sellers as prices rise as does concerns with housing affordability.

The number of homes sold in September in Tulare County dropped from 323 in 2017 to 259 last month, according to the Tulare County Association of Realtors (TCAR). More homes are pending sale than last year and more are spending longer on the market. Homes stayed on the market for an average of 50 days last year compared to 53 days this September. New listings were down 3.6%, sold homes were down nearly 20% yet the number of homes for sale was up 3%.

Home prices continue to increase. TCAR reports that the median price of homes at which homes were sold was up more than 5% and ended last month at $237,000. Homes sold at $150 per square foot on average last month, up from $136 per square foot last September.

The tight housing market in Tulare County is following a trend of low demand for housing throughout the Valley and statewide. Although Kern and Merced counties posted annual sales gains slightly better than 10 percent, sales for the Central Valley Region as a whole were down 5.5 percent from a year ago, according to a report released last month by the California Association of Realtors (CAR). Every other county of the region was flat or down from a year ago.

Overall, California’s housing market dropped below the 400,000-level sales benchmark for the first time in more than two years as high home prices and eroding affordability combined to cut into housing demand.

Closed escrow sales of existing, single-family detached homes in California totaled a seasonally adjusted annualized rate of 399,600 units in August, 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 2018 if sales maintained the August pace throughout the year. It is adjusted to account for seasonal factors that typically influence home sales.

August’s sales figure was down 1.8 percent from the revised 406,920 level in July and down 6.6 percent compared with home sales in August 2017 of 427,630.

“Home sales activity remained on a downward trend for the fourth straight month as uncertainty about the housing market continues to mount,” said C.A.R. President Steve White. “Buyers are being cautious and reluctant to make a commitment as they are concerned that home prices may have peaked and instead are waiting until there’s more clarity in the market.”

The statewide median home price edged up to $596,410 in August. The August statewide median price was up 0.8 percent from $591,460 in July and up 5.5 percent from a revised $565,320 in August 2017.

“While home prices continued to rise modestly in August, the deceleration in price growth and the surge in housing supply suggest that a market shift is underway,” said C.A.R. Senior Vice President and Chief Economist Leslie Appleton-Young. “We are seeing active listings increasing and more price reductions in the market, and as such, the question remains, ‘How long will it take for the market to close the price expectation gap between buyers and sellers?’”

Statewide active listings rose for the fifth consecutive month after 33 straight months of declines, increasing 17.2 percent from the previous year. August’s listings increase was the biggest in nearly four years.

Much of the listings increase is attributable to lower-priced properties. The number of homes available for sale and priced below $750,000 grew more than twice as much as homes priced above that price level.

The unsold inventory index, which is a ratio of inventory over sales, rose again in August from 2.9 months from August 2017 to 3.3 months in August 2018. The index measures the number of months it would take to sell the supply of homes on the market at the current sales rate.

The median number of days it took to sell a California single-family home ticked up from 18 days in August 2017 to 21 days in August 2018.

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