Nervous Sellers Constraining Inventories in California

Sales of existing homes in Californiarnwere essentially flat in January the California Association of Realtors®rn(C.A.R.) said on Wednesday.  Whilerninventories loosened a bit from December levels they are still constrained andrnmany potential sellers are hesitant about selling, nervous about the impact ofrnrising rates and tight lending standards on their ability to purchase theirrnnext home.</p

Homes sold at a seasonally adjustedrnannual rate of 363,640 in January, up 0.3 percent from a revised rate ofrn362,430 units in December but 13.8 percent below the pace of 421,780 units inrnJanuary 2013.  C.A.R. said it was thernthird straight month that sales fell below a 400,000 unit pace and the sixthrnstraight month when sales were lower than a year earlier.  </p

The supply of existing single-familyrndetached homes for sale rose in January to 4.3 months from December’s UnsoldrnInventory Index of 3 as some home sellers listed their homes for the springrnhome-buying season.  The index was 3.5 months in January 2013. C.A.R.rnnoted a six- to seven-month supply is considered typical in a normal market.</p

C.A.R.rnPresident Kevin Brown said, “Supply conditions in the lower-priced segment werernespecially tight as inventory for homes priced below $300,000 fell 13.4 percentrnfrom the previous year, while inventory for homes priced $1 million and higherrnincreased 11.1 percent from last year.”</p

The median price of an existing,rnsingle-family detached home fell 6.2 percent from December’s revised $438,090rnto $410,990 in January. This was 22.1 percent higher than the median inrnJanuary 2013, and was thus the 23^rd consecutive month ofrnyear-over-year price increases and the 19th straight month of double-digitrnannual gains.  The increase in the medianrnwas driven by sales of higher priced homes which made up a larger share of thernmarket compared to a year ago.  </p

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The median number of days it took tornsell a single-family home also increased to 44.3 days in January, up from 40.2rndays in December and from a revised 36.7 days in January 2013.

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