Home Sales in California on the Mend in June

The National Association of Realtors recorded higher home prices in June year-over-year. Although prices dipped since May, they are 30.7% greater than the bottom experienced in February 2009.

In Los Angeles, the median home price in June was just above $300,000 at $301,300, an increase of 4.7% year-over-year and 11.5% from the previous month, according to the California Association of Realtors. Orange County is still fetching premium prices with its median home value at $534,680, a commanding lead in all of the southland.

Interest rate continues to roll lower to deeper rock bottoms. According to the report, 30-year fixed mortgages averaged 3.68% for the period recorded. “Interest rates continued their downward trend in June, with 30-year fixed-mortgage interest rates averaging 3.68 percent, down from 3.80 percent in May and 4.51 percent in June 2011, according to Freddie Mac.  Adjustable-mortgage interest rates averaged 2.76 percent in June, up from 2.74 percent in May but lower than the 3-percent average rate reported in June 2011.”

The amount of time a home is on the market has improved a lot too. The latest figure is 3.5 months for unsold inventory to clear versus 5.1 months last year. According to the report, “The index indicates the number of months needed to sell the supply of homes on the market at the current sales rate.  A 7-month supply is considered normal.” What this means is prices should continue to firm up. More people are able to sell their house and there’s more likelihood that, on average, people will place higher bids for their home purchase.

The national economy had a spat of good news on the housing front as well. U.S. housing starts were up for the month of June, with 760,000 new constructions of rentals and home properties. That’s 2% higher than what forecasts had called for—745,000 new starts. The New York Times states that this batch is the most since four years, making a solid case for a slow recovery.