California’s median home price crosses $900000 threshold – Orange County Register – OCRegister

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“How expensive?” tracks measurements of California’s totally unaffordable housing market.

The pain: The typical California house for sale now costs more than $900,000.


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The source: My trusty spreadsheet looked at the California Association of Realtors report, which says the statewide median price for an existing single-family house reached $904,210 in April. It was a first for the median, which gained 5.8% in a month and 11% in a year.

The pinch

It was only March 2022 when the median crossed the $800,000 for the first time.

There’s a steep price to California’s record pricing – a broad lack of affordability. The association reported the number of California homebuyers in April was below 300,000 for the 19th consecutive month. Homebuying in the state has averaged 402,000 sales a month since 1990.

Note that a house hunter seeking a California house hunter needed a $208,000 household income to qualify to buy the median-priced residence of $814,000 in 2024’s first quarter, a previous study by the association said.

Pressure points

Let’s take a stroll down memory lane, looking at $100,000 thresholds since this price yardstick first crossed the $200,000 mark in March 1991, at the end of that era’s housing bubble.

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By the way, that month’s 9.5% average 30-year mortgage rate, with a 20% down payment, created a payment of $1,345 a month for a buyer spending the threshold price.

$300,000 first crossed in March 2002: Yes, it took 11 years for the next landmark price to fall, as the 1990s were not kind to California’s economy or its housing market. Home sales averaged 377,000 a month in this period. The month’s 7% rate created a monthly payment of $1,598 at this threshold – up 19% from what a buyer theoretically paid when $200,000 was first topped.

$400,000 in August 2003: The early 2000s economic boom translated to a $100,000 climb in a record-fast 17 months. History tells us the upswing was a hint of trouble ahead. Home sales soared to 514,000 monthly. The month’s 6.3% rate created a monthly payment of $1,972 – up 23% from the previous threshold.

$500,000 in April 2005: In 20 months, another benchmark was topped. This was the peak of the easy-money days, creating a massive bubble that burst into the Great Recession. Home sales got even hotter to 572,000 a month. The month’s 5.9% rate created a monthly payment of $2,362 – up 20% from the previous threshold.

$600,000 in May 2018: The ensuing housing debacle meant it took 13 years for the next $100,000 barrier to be crossed. Sales cooled to 415,000 in this tumultuous period. The month’s 4.6% rate created a monthly payment of $2,458 – up 4% from the previous threshold.

$700,000 in August 2020: The pandemic’s push for more living space created momentum for the next barrier to fall in 27 months. Sales dipped to 387,000 amid coronavirus economic challenges. The month’s 2.9% rate created a monthly payment of $2,343 – a drop of 5% from the previous threshold.

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$800,000 in March 2022: Historically cheap mortgage rates helped to inflate prices passed this $100,000 barrier in only 19 months. The buying pace quickened, too, to 454,000 a month. The month’s 4.2% rate created a monthly payment of $3,119 – up 33% from the previous threshold.

$900,000 in April 2024: The limited number of qualified house hunters have battled over a thin inventory of homes listed for sale as rates hit highs not seen in 20-plus years. As a result, sales have averaged a meek 280,000 a month in this 25-month period. The month’s 7% rate created a monthly payment of $4,785 – up 53% from the previous threshold.

Quotable

Sadly, this was the Realtors’ headline on the April report: “Spring homebuying season kicks off with encouraging start.”

I’m not sure many house hunters would agree.

Jonathan Lansner is the business columnist for the Southern California News Group. He can be reached at [email protected]

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