California housing market ends year on high note with strong sales, record-high median price
The California Association of Realtors reports despite a global pandemic that lingered most of the year, two lockdowns and a struggling economy, California’s housing market closed out 2020 on a high note. The state’s housing market had solid sales and a fifth record-high median price in December.
Closed escrow sales of existing, single-family detached homes in California totaled 509,750 units in December, up 0.2 percent from 508,820 in November and up 28 percent from a year ago. The year-over-year, double-digit sales gain was the fifth consecutive and the largest yearly gain since May 2009. For the year, annual home sales rose to a preliminary 411,870 sales in California, exceeding 2019’s pace of 397,960 sales.
“It’s a testament to the strength of the market that even after the pandemic effectively shut down the spring homebuying season in 2020, the market still was able to recover the substantial sales lost in the first half of the year and even top 2019’s levels,” said C.A.R. President Dave Walsh, vice president and manager of the Compass San Jose office. “With mortgage rates expected to stay near the lowest in history, demand for homeownership will continue to be strong, so home sales should remain elevated into the first half of
2021, as motivated buyers take advantage of the increased purchasing power.”
After dipping below $700,000 the previous month, California’s median home price bounced back and set another record high in
December, rising 2.7 percent to $717,930 in December, from November’s $698,890. The statewide median price surged 16.8 percent from $614,880 recorded in December 2019. The statewide median home price for the entire year was $659,380, an increase of 11.3 percent from a revised $592,230 in 2019.
“Home prices, which usually peak during the summer, were unseasonably strong in December,” said Jordan Levine, C.A.R. vice president and chief economist “The imbalance between supply and demand continues to fuel home price gains as would-be home sellers remain reluctant to list their homes during the pandemic, contributing to a more-than-40-percent year-over-year decline in active listings for the seventh straight month.”
At the regional level, sales increased by double-digits in all major regions in December, with the San Francisco Bay Area remaining on top with the highest gain of 40.2 percent over last year and 1.5 percent above November sales. December home sales in Santa Clara County were 31 percent higher than in December 2019 and down 8.8 percent from November.
All major regions posted an increase in the median price from last year by more than 10 percent. The San Francisco Bay Area’s December median price increased 16.4 percent. In Santa Clara County, the December median price was $1,375,000, 12.2 percent higher than $1,225,000 in December 2019, and a mere 0.6 percent lower than the November median of $1,383,000.
“2020 has been an amazing year for our housing market and it took many of us in real estate by surprise because we were and still are in a pandemic. There was that period of lockdown and uncertainty in the spring when the coronavirus hit our state, but the market was resilient and bounced back,” said Joanne Fraser, president of the Silicon Valley Association of Realtors. “Buyer demand has remained strong throughout the year. Typically, the market slows down in December, but homes in Santa Clara County stayed a median nine days on the market, as opposed to 19 days in December last year. The sales-to-price ratio is at 104 percent. I don’t expect housing demand to wane in 2021 as long as interest rates remain at an all-time low.”