 Like the rest of the nation, California housing sales are
rising on unprecedented affordability. The California Association of REALTORS®
says that September 2011 home sales were higher for the third consecutive month
and are at “stable levels.”
So far, it appears that sales on track to parallel sales in
2010, when half the year’s sales were accelerated by federal and state
incentives.
The combination of low prices and interest rates is
thrilling for homebuyers and investors - prices are still well below peak
levels and interest rates are at record lows.
September 2011 housing sales volume was 6.7% higher than the
previous year, according to DataQuick. The median-priced California home was
$249,000, down from $265,000 a year ago.
That’s close to the April 2009 low of $221,000 but well off
the early 2007 peak of $484,000.
Even better for homebuyers, mortgage payments are lower,
thanks to record-low interest rates. The typical mortgage payment commitment in
September was $964, down from $1,055 the previous year. Adjusted for inflation,
says Dataquick, that’s the lowest mortgage payment on record.
Prices are still being compromised by distressed homes –
short sales and foreclosures, more than 50% of the market across the state. Distressed
homes sell at a discount compared to other homes, which is why prices are still
falling despite an increase in demand.
That’s true of Greater Bay Area sales volume and prices,
too. As prices soften month-to-month, sales volume is rising. September Bay
Area median prices were $365,000, down 1.4 percent from August’s $370,000
median, and 7.6% lower than September 2010 when the median was $395,000.
However, the Bay Area has held prices more firmly than the
rest of the state. The Bay Area’s low current cycle median was $290,000 in
March 2009, and the peak was $665,000 in July 2007.
Low prices have attracted investors at near-record rates –
one in five homes sold in September went to a non-occupying buyer.
So, does this news mean it’s time to buy?
Yes, it’s a great time to buy a home, but keep in mind that market conditions
change constantly. Interest rates may rise, but prices may go lower, or they
could both rise and fall in tandem.
The best time to buy is
when you want to own, when you find a home you can comfortably afford, where
you and your household will be content for years to come.
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