California Home Price Records Largest Year-to-Year Gain Since 1980!

Strong sales growth in higher-priced markets and continued housing supply shortage pushed up California’s median home price in May, resulting in the largest year-over-year price gain in at least the last 33 years, the CALIFORNIA ASSOCIATION OF REALTORS (C.A.R.) reported.

Median home prices across the state continued to show signs of recovery thanks to robust sales growth and a continued housing supply shortage, C.A.R. reported this week.

In fact, the surge in median home price in May led to the largest year-over-year price gain in at least the last 33 years. Based on information collected by C.A.R., the statewide median price of an existing, single-family detached home was $417,350 in May, which is an increase of 3.6 percent from April’s median price of $402,760. There have been 15 straight months of annual price increases on top of eleven consecutive months of double-digit annual gains.

“While home prices are increasing at levels above those observed in 2006-2007, the fundamentals of the housing market are much more solid than what we experienced a few years ago,” said C.A.R. Vice President and Chief Economist Leslie Appleton-Young.  “More home buyers are putting down larger down payments, and many of them are opting for more stable loan products.  Additionally, historically low mortgage rates have reduced monthly mortgage payments substantially, making owning a house more affordable, even with rising home prices.”

In comparison to April, sales in May were up 1.9 percent, with 431,370 existing, single-family detached California homes being sold. The state’s Unsold Inventory Index is noticeably down from last year, which speaks to the diminished supply of available homes for sale. While a six- to seven-month supply is considered normal, the rate was 2.6 months in May.

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