It’s happening. Bit by bit, little by little, new life is being breathed into the California real estate market. On Monday, October 26, the California Association of Realtors posted its sales and price report for the month of September, and it held some very, very encouraging news.
For the seventh straight month, resale home prices in California increased.
This stretch, which follows a period in which sales had decreased for 22 consecutive months, is a clear indicator that things really are improving. In addition to the increase in resale prices, the unsold inventory index – the index signifies the number of months needed to deplete the supply of homes on the market at the current sales rate -- fell to 4.2 months, compared with 6.5 months for the same period in 2008.
Not only are homes now selling at somewhat higher prices, they are also taking less time to sell. In September, the median number of days – the number which is exactly in the middle between the most and the least amount of days it has taken to sell a home - to sell a single-family home was just shy of 34. In September 2008, the median was almost 47 days.
For the sellers of real property in California, this news is nothing but good. While home prices might not be at the levels of 2007 (it will likely be quite a while before we get there again), this steady increase will alleviate much of the pressure and worry being felt at watching home prices fall and dwindle. Sellers, and their Realtors, will be able to price their homes with greater confidence of achieving their listing price.
For buyers, too, the news is good. Because it very clearly points out that for those considering purchasing a home, the time to do so really is now. Prices are still very low, by comparison to the standards of 2006 & 2007, and mortgage rates are still at record lows. As we’ve (and just about every other news outlet) pointed out, too, the Homebuyer Tax Credit, unless Congress decides to extend it, is set to expire in just about a month. Combining the tax credit with low prices and low mortgage rates is an opportunity that first-time homebuyers might not have again.
The bottom line: while this news shouldn’t give us cause to think that the hard times have come to an end, it is very encouraging. Things are getting better. Slowly, but surely, we are getting there.