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Low interest rates boost California

Low interest rates boost California housing market as median home price sets another record, C.A.R. reports

- Existing, single-family home sales totaled 406,100 in August on a seasonally adjusted annualized rate, down 1.3 percent from July and up 1.6 percent from August 2018.
- August’s statewide median home price was $617,410, up 1.5 percent from July and up 3.6 percent from August 2018.
- Year-to-date statewide home sales were down 4.1 percent in August.

LOS ANGELES (Sept. 17) – Fueled by mortgage interest rates at near-three-year lows, California’s housing market recorded a second consecutive year-over-year sales increase while the median home price reached a new high, the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) said today.

Closed escrow sales of existing, single-family detached homes in California totaled a seasonally adjusted annualized rate of 406,100 units in August, according to information collected by C.A.R. from more than 90 local REALTOR® associations and MLSs statewide. The statewide annualized sales figure represents what would be the total number of homes sold during 2019 if sales maintained the August pace throughout the year. It is adjusted to account for seasonal factors that typically influence home sales.

August’s sales figure was down 1.3 percent from the 411,630 level in July and up 1.6 percent from home sales in August 2018 of 399,600. While cumulative sales through the first eight months of the year were down from last year, the pace of decline has improved significantly at -4.1 percent since the -12.5 percent recorded in January.

“Housing demand has exhibited signs of improvement in recent months as lower rates continued to reduce the cost of borrowing for home buyers,” said C.A.R. President Jared Martin. “However, buyers remain cautious, and many are reluctant to jump in because of the economic and market uncertainty that continue to linger, and that is keeping growth subdued despite significantly lower rates.”

After a pullback in July, the median price rose from both the previous month and year and reached another record high in August. August’s median price was $617,410, up 1.5 percent from July and up 3.6 percent from $595,920 in August 2018, marking the fifth straight month that the median price remained above $600,000. The annual sales gain was the highest in the last 10 months.

“Low interest rates, which helped to reduce monthly mortgage payments, have provided much-needed support to improve housing affordability and elevate home sales over the past few months,” said C.A.R. Senior Vice President and Chief Economist Leslie Appleton-Young. “While lower rates have no doubt boosted buyers’ purchasing power, they have also been a contributing factor to higher home prices this year.”

Other key points from C.A.R.’s August 2019 resale housing report include:

• At the regional level, non-seasonally adjusted sales fell on both a monthly and an annual basis from a year ago in all major regions, with the Central Coast recording the largest yearly decline at 6.4 percent. The Central Valley experienced a 2.3 percent year-over-year decline. The Inland Empire posted a 2.4 percent yearly decline, and sales in the Los Angeles Metro region dipped 1.1 percent from last year. In the San Francisco Bay Area sales were down from a year ago by 3.8 percent, with seven of nine counties recording sales declines from a year ago.

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‘The R® Stands for More’

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who we R logoHelping consumers understand why working with a REALTOR® is the best choice for this life-changing transaction goes way back to 1913. That’s when National Association of REALTORS® began to set their members apart by adopting a Code of Ethics that still guides the business decisions of 1.3M REALTORS® today. The REALTOR® Code of Ethics isn’t just words on a page, but is a pledge of honesty, integrity, professionalism, and community service. Partnering with a REALTOR® delivers the peace of mind that comes from working with a real person. A real advocate. A real, trusted professional who is committed to their clients’ futures and neighborhoods just as much as they are.

It’s the Code of Ethics that helped to inspire our new campaign, “That’s Who We R®”. The campaign will demonstrate the value of a REALTOR®, distinguish REALTORS® from the rest, and deliver a sense of pride in being a REALTOR®.

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We're more than just REALTORS®

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As Champions of Home™, California REALTORS® are optimists. Helpers. Explorers of neighborhoods. And friends of the community. It's our job to help with the piles of paperwork. The mind-numbing details. And intimidating issues associated with real estate. So, whether buying or selling a home, count on a REALTOR®. We help millions of Californians close on their dreams everyday.

Here's how we can help:

1. REALTORS® can help you wade through the cumbersome and often complicated paperwork that goes hand-in-hand with any real estate transaction, making sure the proper forms are filled out correctly and on time. This includes the crucial purchase agreement, which serves as the contract between a buyer and seller, and is used to formally identify a purchase price; list terms and conditions pertaining to the sale time frame; and other details, such as a written commitment by the seller to cover the costs of any necessary repairs.

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