California pending home sales slipped negligibly from a year ago, which suggests a softening in the housing market in the upcoming months, the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) said Friday.
Based on signed contracts, statewide pending home sales decreased in January on a seasonally adjusted basis, with the Pending Home Sales Index (PHSI)* slipping 0.2% from 107.4 from January 2016 to 107.2 in January 2017. On a monthly basis, California pending home sales were down 9.2% from the December index of 118.0.
Only the Southern California region posted a year-over-year improvement in pending sales last month, rising 8.1% from January 2016 and increasing 10.5% on a monthly basis. Riverside County led the region in pending sales, posting a 16.2% increase from a year ago. Los Angeles, Orange, and San Diego counties also posted modest year-over-year increases of 7.1%, 8.0%, and 4.0%, respectively.
San Bernardino County was the only area within Southern California that saw pending sales lower on an annual basis by 2.8%.
For the San Francisco Bay Area as a whole, tight housing supplies and low affordability contributed to a fall in pending sales of 9.7% compared to January 2016. Only San Mateo County posted an annual increase, rising 5.3% from January 2016 after posting a significant double-digit annual decline (35.3%) in December. Pending home sales decreased 21.2% in San Francisco County, 7.1% in Santa Clara County, 24.9% in Monterey, and 4.8% in Santa Cruz County. A shortage of homes on the market and poor affordability will likely persist throughout the year and impact Bay Area home sales.
Pending sales in the Central Valley fell 7.9% from January 2016 and were up 2.2% from December. Within Central Valley, pending sales were down 14.6% in Kern County and 11.8% in Sacramento compared with a year ago.
