9:54am | The California Association of Realtors on Wednesday debuted its Pending Home Sales Index, which shows that pending home sales in California rose in January. The index was 93.6 in January, up 13.6% from December’s 82.4.
Pending home sales are forward-looking indicators of future home sales activity, providing information on the future direction of the market, according to CAR. The year 2008 was used as the benchmark for the index–100 is equal to the average level of contract activity during that year.
“Pending sales typically rise in January from a seasonally slow November and December,” C.A.R. President Beth L. Peerce said in a statement. “January’s pending sales should be reflected in higher existing sales activity in February and March and serve as a precursor to the spring home buying season.”
On the other hand, a story in the L.A. Times on Wednesday states that if things don’t shape up, the nation’s housing market could be headed for a double dip.
“With foreclosures high and demand weak, home prices in a majority of the nation’s largest metropolitan areas posted fresh lows in December and pushed a widely watched index of real estate values close to a double-dip decline,” the story states. “The Standard & Poor’s/Case-Shiller index showed that prices in 20 major U.S. cities dropped an average of 2.4% in December from the same month a year earlier and 1% from November, the fifth straight month the index has fallen.”
Yale University Professor Robert Shiller told the Times: “My intuition rates the probability of another 15%, 20%, even 25% real home price decline as substantial.”
A drop in sales and values would be particularly bad for affordable communities, such as Long Beach, where foreclosures weigh down already weakened sales and create blight in neighborhoods.
A report released today by RealtyTrac, the Year-End and Q4 2010 U.S. Foreclosure Sales Report, shows foreclosures accounted for more than a quarter of all U.S. residential sales during the year. That’s down from 29% in 2009.
The report also shows that the average sales price of these foreclosure properties was more than 28% below the average sales price of properties not in foreclosure.
A total of 831,574 U.S. residential properties either owned by banks or in some stage of foreclosure were sold to third parties in 2010, a drop of 31% from 2009 and down nearly 14% from 2008.
A total of 149,303 foreclosure sales were recorded in the fourth quarter, down 22% from the previous quarter and down 45% from the fourth quarter of 2009. This was despite a 21% monthly uptick in foreclosure sales volume in December. Foreclosure sales in the fourth quarter accounted for 26% of total sales, and foreclosure properties sold for an average sales price that was 28% below the average sales price of properties not in foreclosure during the quarter.
California foreclosure sales accounted for 44% of all sales in 2010, the third highest of any state but also down from a peak of 57% in 2009, and fourth quarter foreclosure sales in California accounted for 45% of all sales, up from 40% in the third quarter, according to the RealtyTrac report.