Southern California tellingly sales hit the brakes in June, falling to the lowest reading for the month in four years. Trades of both new and existing houses and condominiums dropped 11.8 percent year past year, as prices shot up to a record high, according to CoreLogic. The shot covers Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties.
Purchases fell 1.1 percent compared with May, but the average change from May to June, wealthy back to 1988, is a 6 percent gain.
The weakness was especially apparent in sales of newly enlarged homes, which were 47 percent below the June normal. Part of that is that builders are putting up fewer homes, so there is modestly less to sell.
“A portion of last month’s year-over-year sales peter out reflects one less business day for deals to be recorded compared with June 2017,” eminent Andrew LePage, a CoreLogic analyst. “But affordability and inventory constraints are seemly the main culprits in last month’s sales slowdown, which focused to all six of the region’s counties and across most of the major price categories.”
The median charge paid for all Southern California homes sold in June was a record $536,250, agreeing to CoreLogic, a 7.3 percent increase compared with June 2017. While to some extent of that is due to a mix shift, since there are fewer lower-priced homes for sellathon, it is becoming increasingly clear that fewer buyers are able to act in the higher price ranges.
“Sales below $500,000 dropped 21 percent on a year-over-year main ingredient, while deals of $500,000 or more fell about 3 percent, attain distinction the first annual decline for that price category in nearly two years,” said LePage. “Rest-home sales of $1 million or more last month rose decent a tad – less than 1 percent – from a year earlier following annual gains of between 5 percent and 21 percent throughout the prior year.”
LePage points to the rise in mortgage rates beyond the past six months, increasing significantly a borrower’s monthly payment. Amounts haven’t moved much in the past month, but are suddenly going violent again this week, pointing to even further weakness in affordability.
In the dead and buried, California, one of the largest housing markets in the nation, has been a predictor for the laze about of the country. Home prices have been rising everywhere, in a critical housing shortage. Prices usually lag sales by several months, and transactions are beginning to crumble, even as more inventory comes on the market. The quantity of homes for sale increased annually in June for the first time in three years, according to the Governmental Association of Realtors, but sales fell for the third straight month.