Recent reports reveal a stagnation in California’s housing market, with September sales hitting a nine-month low. According to the California Association of Realtors (C.A.R.), even with interest rates reaching their lowest since spring, home sales in September remained unchanged.
Data indicates that the number of single-family home transactions in California reached a seasonally adjusted annual rate of 253,010 in September, down 3.4% from August’s 262,050 but up 5.1% compared to 240,840 from the previous year. Year-to-date sales data shows a slight increase of 0.9% compared to the same period in 2023.
C.A.R. President Melanie Barker commented, “As we enter the traditional slow season, the housing supply has gradually improved in recent months. With the possibility of further price declines in the coming months, the fourth quarter may present a good opportunity for potential buyers looking to reenter the market, particularly as interest rates trend back toward historical averages.”
The statewide median home price dropped by 2.3% from August’s $888,740 to $868,150, while still reflecting a 2.9% increase year-over-year. This marks the fifteenth consecutive month of year-over-year price increases, although the growth rate is the slowest since July 2023. As the market enters its typical slow season, prices may continue to decline, yet a year-over-year growth is still anticipated.
High-end home sales have consistently influenced price fluctuations, though their impact on overall state median price growth has diminished in recent months. Sales of homes priced at $1 million and above account for just 3.9%, whereas the market for homes priced below $500,000 has struggled, experiencing an 8.6% decline year-over-year. If the share of high-end properties continues to decrease this fall, the growth of median prices may further slow in the upcoming months.
Regionally, all major areas saw home sales in September exceed last year’s levels, except for the Central Valley and Central Coast. The North Far region experienced the highest growth at 7.2%, followed by the San Francisco Bay Area at 5.1% and Southern California at 1.1%.
Among the 53 counties tracked by C.A.R., 27 reported an increase in home sales year-over-year, with 12 of those counties seeing growth exceeding 10%. Lassen County recorded the largest increase at 78.6%, followed by Siskiyou at 75.0% and Mariposa at 50.0%. Conversely, 25 counties experienced year-over-year declines, with Mono County showing the steepest drop at 50.0%.
In terms of median home prices, most major regions saw increases in September compared to the previous year, with the Central Coast recording the largest gain at 4.6%, followed by the Central Valley at 4.0% and Southern California at 3.7%. The San Francisco Bay Area, however, reported the largest decline at 2.6%, followed by the North Far region at 1.4%.
C.A.R. Chief Economist Jordan Levine noted that economic uncertainty and expectations for low interest rates may have caused many buyers to delay their purchasing decisions, leading to two consecutive months of declining sales and the lowest point of the year. However, recent rebounds in bond yields serve as a reminder that interest rates will continue to fluctuate, suggesting that waiting may not be the best strategy for potential homebuyers.
