California pending home sales rise on annual basis, post double-digit year-over-year gains in last nine of 10 months

LOS ANGELES (June 22) – Pending home sales in California were flat from April but posted double-digit gains from the previous year for the fourth straight month, the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) reported today.  Additionally, the share of distressed sales continued to decline from year-ago levels, signaling a return of non-investors to the housing market.

Pending home sales:

C.A.R.’s Pending Home Sales Index (PHSI)* was unchanged in May from a revised 128.8 in April, based on signed contracts.  The index was up from the 115.8 index recorded in May 2011.  May marked the thirteenth straight month that pending sales were higher than the previous year.  Pending home sales are forward-looking indicators of future home sales activity, providing information on the future direction of the market.

“Despite a slowdown in economic growth in recent months, sales in California remain strong as record low mortgage rates and favorable home prices continue to fuel demand in the housing market,” said C.A.R. President LeFrancis Arnold. “The strong results in pending sales – double-digit year-over-year gains in the last nine out of 10 months – suggest solid housing market performance for the state in the upcoming months.”

Distressed housing market data:

• The share of equity sales – or non-distressed property sales – compared with total sales improved further in May.  The share of equity sales rose to 59.3 percent in May, up from 55.8 percent in April.  Equity sales made up 51 percent of all sales in May 2011.

• Likewise, shares of REOs and short sales sold statewide decreased in May, with the share of REO sales dropping the most markedly from a year ago.  The combined share of all distressed property sales fell to 40.7 percent in May, down from April’s 44.2 percent and from 49 percent in May 2011.

• The share of short sales declined in May to 19.4 percent, down from 20.6 percent in April and from 20.3 percent a year ago. 

• Of the distressed properties, the share of REO sales declined further in May to 21 percent, down from 23.2 percent in April and 28.4 percent in May 2011.

• The available supply of REOs for sale continued to tighten in May, with the Unsold Inventory Index declining from a 2-month supply in April 2012 to 1.5 months in May 2012.

Multimedia and charts:

• View a chart of closed housing sales in May by sales type (equity, distressed).

• View a chart of pending sales compared with closed sales.

• View a chart of the historical trend in the share of equity sales compared with distressed sales.

• View a chart of housing supply for REOs, short sales, and equity sales in May.

Share of Distressed Sales to Total Sales
(Single-family)

 

Type of Sale May 2011 April 2012 May 2012
Equity Sales 51.0% 55.8% 59.3%
Total Distressed Sales 49.0% 44.2% 40.7%
     REOs 28.4% 23.2% 21.0%
     Short Sales 20.3% 20.6% 19.4%
     Other Distressed Sales (Not Specified) 0.3% 0.4% 0.3%
All Sales 100.0% 100.0% 100.0%


Single-family Distressed Home Sales by Select Counties
(Percent of total sales)

County May 2011 April 2012 May 2012
Amador 61% 41% 50%
Butte 44% 44% 37%
Fresno 63% 62% 57%
Humboldt 17% 36% 34%
Kern 66% 54% NA
Lake 80% 64% 70%
Los Angeles 45% 44% 41%
Madera 85% 67% 79%
Marin 28% 29% 21%
Mendocino 51% 67% 44%
Merced 59% 58% 54%
Monterey 59% 55% 52%
Napa 43% 41% 44%
Orange 36% 33% 33%
Riverside 65% 56% 54%
Sacramento 65% 61% 58%
San Benito 66% 56% 59%
San Bernardino 69% 57% 59%
San Diego 29% 23% 23%
San Luis Obispo 40% 44% 35%
San Mateo 23% 24% 21%
Santa Clara 34% 27% 28%
Santa Cruz 41% 49% 33%
Siskiyou 82% 62% 54%
Solano 71% 69% 70%
Sonoma 48% 44% 45%
Tehama 62% 58% 65%
Tuolumne NA 61% 46%
California 49% 44% 41%

 **Note:  C.A.R.’s pending sales information is generated from a survey of more than 70 associations of REALTORS® and MLSs throughout the state.  Pending home sales are forward-looking indicators of future home sales activity, offering solid information on future changes in the direction of the market.  A sale is listed as pending after a seller has accepted a sales contract on a property.  The majority of pending home sales usually becomes closed sales transactions one to two months later.  The year 2008 was used as the benchmark for the Pending Homes Sales Index.  An index of 100 is equal to the average level of contract activity during 2008.

Leading the way…® in California real estate for more than 100 years, the CALIFORNIA ASSOCIATION OF REALTORS® (www.car.org) is one of the largest state trade organizations in the United States with 155,000 members dedicated to the advancement of professionalism in real estate. C.A.R. is headquartered in Los Angeles.

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