Volume drops with restricted inventory and March’s median home price jumps with fewer low end sales. Strangely, CAR suggests that bulk REO sales would be a possible solution, even though those sales would be as rentals to institutional investors and do nothing to add needed inventory to the market. In the past, both CAR and NAR have come out against the bulk REO program. I wonder why the flip-flop?
Closed escrow sales of existing, single-family detached homes in California totaled a seasonally adjusted annualized rate of 505,360 units in March, according to information collected by C.A.R. from more than 90 local REALTOR® associations and MLSs statewide. Sales in March were down 4.5 percent month-over-month and 2.3 percent year-to-year. The statewide sales figure represents what would be the total number of homes sold during 2012 if sales maintained the March pace throughout the year. It is adjusted to account for seasonal factors that typically influence home sales.
The statewide median price of an existing, single-family detached home jumped 9.2 percent to $291,080 in March from February’s $266,660 median price and was up 1.6 percent from a revised $286,550 recorded in March 2011. The month-to-month increase was the largest since March 2004.
“Housing inventory remains extremely tight throughout the state and at levels severely under normal market conditions,” said C.A.R. Vice President and Chief Economist Leslie Appleton-Young. “In areas, such as Los Angeles and Riverside counties, where the Federal Housing Finance Agency (FHFA) wants to implement the REO bulk sale pilot program, inventory is running at levels well below the long-run average. These low inventory levels demonstrate that the pilot program is not necessary in California.”
The pilot program calls for the sale of more than 600 Fannie Mae-owned foreclosed homes in Los Angeles and Riverside counties to institutional investors.