Our 2020 housing market continue to improve with September posting another increase not only a month-over-month increase of 9% (1,068 / 1,169) but a whopping 19% increase over last September (944). That brings us to within a rounding error of year-to-date sales volume just 21 units less than 2019 (8,357 / 8,337). Incredible given the constraints working under a COVID environment. And at a time of year where sales should be coasting into year-end, pending sales are up another 1% going into October forecasting yet another strong month ahead. This is the highest sales volume posted for a September in this region!
Median price dipped slightly in September coming in 1% below August ($444,500/ $441,142) but posted a respectable 10% increase over September 2019 ($359,990). That leaves our year-to-date lead over 2019 at 7% ($384,452 / $415,312). Driven by 20 sales in excess of $1,000,000 (nearly 10% of their total sales volume), Temecula notched another milestone average price in September at $640,771. Murrieta’s average price with 13 sales over $1,000,000 hit $550,884 and Canyon Lake’ average price rose to $653,854 with 4 sales over $1 million. While the median price increase is driven more by increases in the lower end of the market, average price reflects strong sales in the upper registers. Our market is currently benefitting from healthy demand across the spectrum of the market.
Of course, we would be remiss if we didn’t give another nod to our shrinking inventory. While the number of homes for sale did increase 7% last month (832 / 895), it was down 62% from last year (2,350) and marked 4 consecutive months where sales exceeded inventory. Another month or two of strong demand will bring the market up short as there will simply be no more supply to feed the beast. As it is, months of inventory remained unchanged at .8, or roughly 3 weeks supply, and homes flew off the market even faster in September than August (7.9 days / 7.1 days). Last September homes were sticking around for 28.7 days or 75% longer than today.
What we’re experiencing mirrors what the rest of the state is going through as well with both sales and median price up more than 14% over last year. The median price of a home in California exceeded $700,000 for the first time in August and, while the rest of the state is luxuriating with a 2.1 month inventory, it’s still not even close to the 6-7 months considered to be a balanced market.
Sub 3% interest rates expected to remain in effect for some time are driving not only first-time and Millenial buyers into the market but driving existing owners to upgrade and/or purchase a 2nd home. Those first time buyers are driving our median price market while the upgrade and 2nd home buyers are propelling sales in the Wine Country and La Cresta. This market exuberance marks a departure from the wider economic picture cautioning a potential for increased foreclosure activity and commercial declines resulting from the current pandemic hysteria. By this time next month, we’ll probably have a better idea of the direction the nation is headed – either four more years of chaos with tax and regulatory reductions, or four more years of chaos with tax and regulatory increases. In California, our vote doesn’t matter much.
Where our votes do matter are local issues and candidates who will propel our cities into the future. For that reason, I have included an endorsement summary of candidates and issues supported by the Southwest Riverside County Association of Realtor®. Regardless of who wins, SRCAR stands ready to provide our support and advocate on behalf of property ownership.
Stay well and please get out and vote, or send it in, or drop it off – JUST VOTE! Thank you.
Gene Wunderlich is Vice President, Government Affairs for Southwest Riverside County Association of Realtors. If you have questions on the market, please contact me at GAD@srcar.org.