Home sales temper in August as market continues to return to normal

Housing demand in California tempered for the fourth consecutive month in August, as home sales returned to pre-crisis levels, according to the California Association of Realtors’ August housing market report. The statewide median home price, however, set another record high.

Closed escrow sales of existing, singlefamily homes in California totaled 414,860 in August, down 3.3 percent on a monthly basis from 428,980 in July and down 10.9 percent from a year ago, when 465,400 homes

were sold. August’s sales level was the lowest in 14 months. Despite the monthly and annual sales drop, California home sales remained strong by pre-pandemic standards, maintaining a solid yearto-date increase of 21.3 percent.

Meanwhile, California’s median home price set a new record in August at $827,940, the fifth record set in six months. The August price was 2.1 percent higher than $811,170 recorded in July and

17.1 percent higher than $706,900 recorded last August.

“The higher-priced segments continue to see double-digit sales growth that’s keeping the overall market from moderating too fast,” said C.A.R. Vice President and Chief Economist Jordan Levine. “With interest rates expected to stay low for the rest of the year, sales in California will remain solid by pre-pandemic standards while price growth will likely ease further in the coming months.”

Nearly three-quarters of all counties — 37 of 51 — tracked by C.A.R. posted year-over-year decreases in closed sales in August, with 23 counties declining

by more than 10 percent from last year. Housing demand was negatively affected in all of the counties threatened by wildfires in the last few weeks.

At the regional level, the San Francisco Bay

Area (2.5 percent) and the Central Coast (0.8 percent) were the only regions where sales increased from last year. In the Bay Area, San Francisco (13.6 percent), and Santa Clara (10.6 percent) experienced a double-digit sales gain from August last year, while San Mateo’s home sales increased 6.4 percent. Compared to July, Santa Clara County home sales in August were down 7.6 percent and

home sales in San Mateo County were down 7.8 percent

Median prices in all major regions continued to increase by doubledigits in August. The median price in the San Francisco Bay Area jumped 18.4 percent.

All but two of 51 counties tracked by C.A.R. showed a year-over-year gain from last August. Calaveras had the largest price growth at 27.3 percent, followed by Alameda (26.4 percent) in the East Bay.

The August median home price in

Santa Clara County was $1,655,000, 18.2 percent higher than in August 2020, when the median was $1,400,000. The median took a

slight dip of 0.9 percent from the July median of $1,670,000. San Mateo County’s August median sales price was $1,925,000, 6.2 percent higher than of $1,812,500 in August last year and 8.8 percent lower than $2,110,000 in July.

“Though Silicon Valley’s housing market remains competitive, we are seeing prices slowly moderating. The market has also transitioned into the off-season, and interest rates remain at a record low. This creates an opportunity for homebuyers who opted to wait when the market was in a frenzy to get back in,” said Joanne Fraser, president of the Silicon Valley Association of Realtors. “Get everything you need in order – get pre-approved by a lender, consult a professional Realtor who is knowledgeable about the neighborhood of your choice, so when the time is right, you’ll be ready to make an offer.”

The 30-year, fixedmortgage interest rate averaged 2.84 percent in August, down from 2.94 percent in August 2020, according to Freddie Mac. The five-year, adjustable mortgage interest rate was an average of 2.42 percent, compared to 2.91 percent in August 2020.