Nationwide, July saw the sale of existing homes decrease for the fourth straight month. Some Wall Street Journal economists had predicted an increase of 0.6% from June to July due to what looked like a recovering market after the recession. It actually fell 0.7%. Rising house prices are pricing people out of affordable housing rather than being a predictor of recovery. Indeed, the median house price has risen 4.5% while average wages have risen only 2.7%. Interest rates are also up 0.5% since the beginning of the year. Curiously, sales rate of some of the most affordable housing at the bottom of the price spectrum, those under $100,000, decreased 11% since July of last year, while the rate of sale of those over $1 million increased 16%.
Of course, with home prices as high as they are in California, the numbers are going to be different than the nationwide average. A price over $1 million is much easier to find than a price under $100,000, and accordingly, July was only the third consecutive month of overall decrease in sales of existing homes, not the fourth.