What’s going on in the CA housing market? September 2020 Update

So much has happened since we last checked in! Maybe that’s an understatement. In any case, September has come and gone, yet generated some valuable real estate insights we want to share with you. Here’s what you should know about California real estate. 

September’s Outlook 

In California, the market data points to a slow-paced recovery. While there’s plenty of gains to be had for both buyers and sellers, the ricochet back to the pre-pandemic normals is still far off. 

The initial emergence from the pandemic’s long-lasting disruption period had analysts projecting two very different market forecasts: one extremely optimistic and the other… well, not so much. 

However, that was back in July – and the outlook was foggy. August fostered more positive growth, with unemployment rates finally falling below 10%, record-low mortgage rates, and a fierce increase in buyer activity. These wins further solidified the belief that recovery would be over in the blink of an eye… but, we shouldn’t jump to any conclusions just yet. 

September has seen some slight ebbs and flows – with the sales volume declining in the third week only to kick back up by the fourth week of the month – leading us into October on solid grounds. The market’s immediate moment may not be meeting those idealist predictions set at the first upturn of recovery, but CA’s housing market is performing strongly all the same.

Let’s back up September’s analysis with Reali’s rapid-fire market stats highlighting four of California’s major markets: 

Sacramento

• Sacramento’s pool of added listings remained the same as August’s levels, with 4,324 new listings posted for sale. YOY, this is -52% less than in 2019. 
• 4,600 listings sold in September, representing positive YOY growth of +22%. 
• Sacramento’s average listing price was $485,482 – marking MOM gains of +2% and YOY gains of +14%. 
• The current price per sq. ft. rose +10% from September 2019. 

Bay Area 

• 7,765 new listings were posted in the Bay Area, marking +6% MOM growth and -15% YOY decline. 
• 5,786 listings sold, demonstrating gains for both MOM (+4%) and YOY (+34%). 
• The average listing price was $1,289,899, up by +1% MOM and +16% YOY.
• East Bay’s total sales reached $2,548,273,377, +47% up from September 2019. 
• Peninsula/SJ sales generated $4,015,784,895, a whopping increase of +64% YOY and +9% MOM. 
• San Francisco’s sales reaped $899,294,562, up +47% YOY and +10% MOM. 

Los Angeles

• With only 22,878 new properties posted this month, the volume of new listings added to LA’s market was -37% less than September 2019’s activity.
• Again, the amount of listings sold has beaten out both MOM and YOY levels. 15,757 listings sold, +18% more than 2019, and +5% more than August. 
• The average selling price was $837,177, +15% higher than September 2019 and +3% higher than in August. 

San Diego 

• New listings plummeted in September with only 2,265 new properties posted on the market, marking a decline of -64% YOY and -40% MOM. 
• While listings sold nearly equates to the new listings added, the sales volume rose +2% MOM but declined -28% YOY. 
• The average listing price was $850,420 – up YOY by +18% and MOM by +2%. 

Keep Your Eyes on the Market 

Balance is key for navigating California’s real estate market moving forward. 

September made some notable headway forward in terms of economic growth, as the last week of September attained the same sales volume as seen in 2006. At the same time, CAR reported the largest spurt in the consumer confidence index seen in a one-month period for the last 17 years. As people become more comfortable with the current conditions, the already robust pool of buyers is expected to stay eager and competitive. 

However, sales trends remain on an up-and-down rhythm and the number of new listing additions across the state continues to dwindle. With buyers quickly closing deals and snagging up the available properties, the market’s supply is shrinking. 

The luxury arena seems to be seeing the best of right now’s market conditions, with listing volume seeing a lack of renewal in all price ranges except the $3 million mark. California’s high-end market continues to see activity for both buyers and sellers. 

In this hot-and-cool market, experts warn that California’s housing market may see even slower weeks ahead as real estate gradually ascends from the pandemic’s low points.

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