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California’s pending home sales post biggest growth in 6 years

Andy Dean

Pending home sales in California soared in February, recording the first double-digit annual gain in nearly three years and the third straight year-to-year increase.

Pending home sales in California soared in February, recording the first double-digit annual gain in nearly three years and the third straight year-to-year increase, according to latest figures from the California Associate of Realtors.

The data suggest improved market conditions and more closed transactions in the coming months, Los Angeles-based C.A.R. said in its monthly report.

The California index for pending home sales, based on signed contracts, rose 24.8 percent from a revised 89.9 in January to 112.2 in February, beating the long-run average increase of 17.9 percent over the last seven years.

Compared with a year ago, February’s pending home sales increased 15.6 percent, the largest jump since April 2009 and the first double-digit gain since April 2012.

For Southern California, pending home sales grew 25 percent in February to an index of 98.9 and was up 15.2 percent from 85.8 in February 2014.

Statewide, the share of equity sales – or non-distressed property sales – grew slightly as a share of the market, after declining for three straight months. Equity sales made up more than 89 percent of all home sales in February, up from 88.1 percent in January and 85 percent in February 2014. Equity sales have been more than 80 percent of total sales since July 2013 and have risen to or near 90 percent since mid-2014.

Meanwhile, the combined share of all distressed property sales fell in February, down from 11.9 percent in January to 10.9 percent in February. Distressed sales made up 15 percent of total sales a year ago.

In a separate report, California Realtors responding to C.A.R. survey said they saw fewer multiple offers but an increase in open house traffic from a year ago.

In a sign of a less competitive housing market, about one in five homes (21 percent) sold above asking price, down from its peak of 40 percent in March 2014 and from 34 percent a year ago. The share rose slightly from the lowest point of 16 percent in January. Nearly half of homes (49 percent) closed below asking price, down from 55 percent in January.

Sixty-one percent of properties received multiple offers in February, up from 58 percent in January but down from 71 percent a year ago.