Existing home sales, prices hit new records

By Gary Gentile The Associated Press
Wednesday May 29, 2002

LOS ANGELES — Existing single family homes sold at a sizzling pace and at record prices in April, according to the California Association of Realtors. 

For the second straight month, the median price of an existing single family home was above $300,000, a situation that, combined with a dwindling inventory, is pricing many buyers out of the market. 

Sales of existing homes increased 29.8 percent in April compared with the same period last year and 9.7 percent from last month, according to seasonally adjusted figures obtained from Realtor associations throughout California. 

The median price of a California home was $321,950 in April, a 26.1 percent jump from April 2001. 

“With only a two-month supply of homes for sale throughout the state, there simply isn’t enough inventory available to meet the demand for homes,” said CAR President Robert Bailey. 

The crunch was predictably higher in the San Francisco Bay area, where sales shot up 73 percent in April compared with a year ago. In Santa Clara County, home to Silicon Valley, sales surged nearly 120 percent in April. 

Monday, another real estate tracking agency reported that a mid-priced home in the San Francisco Bay area sold for $402,000 in April — topping the previous peak of $386,000 in March 2001 

Southern California prices also climbed to a new high, hitting a mid-range of $258,000 — up $1,000 from the high established in the previous month, according to monthly statistics compiled by DataQuick Information Systems. 

DataQuick’s survey is based on all home and condominium sales, including the sale of new homes, recorded by county recorders. 

The summer will bring no relief for struggling home buyers, CAR reported. 

“Low inventory, favorable mortgage interest rates and rapidly rising home price appreciation will continue to intensify the pace of home sales in the coming months, said CAR chief economist Leslie Appleton-Young. 

As buyers were priced out of many markets throughout the state, prices began to show huge spikes in historically more affordable areas such as Culver City, South Pasadena and Twenty-nine Palms, the report showed. 

“It’s a classic case of too many buyers,” said Art Perez, an associate at Cavanaugh Realtors in Culver City. “You had better be ready to pay full price for something that day because if you wait two or three days it might be sold.” 

Perez said spiraling prices are making it especially difficult for renters seeking to enter the home market. 

“The rent prices have gone up so much, that has pushed everything else up,” he said. “Now a condo that used to be $90,000 is $160,000. You used to be able to come into Culver City and buy a cute little house for $300,000. Now it’s $400,000. It’s a very freaky time.” 

Even buyers willing to pay full price are finding it tough to close sales as sellers hold out for buyers with large down payments, said Tom Rosas, an agent at Century 21 Grisham-Joseph in Whittier. 

“The market is so strong, they know they can wait for a 20 percent down buyer and get one,” Rosas said. 

CAR reported a two-month inventory of unsold detached single family homes in April, half the number for April 2001.