The median price for existing homes in California gained 1.4% in April, posting an increase for a second month in a row. The bold are calling this the bottom (or close to it), though another financial market surprise could change the rules as it did six months ago. However, if the small uptick is real, it could mean that the worst is behind us, as some use the California residential real estate market as a leading indicator for the broader economy.
What makes this development so special? Quite frankly, it matters most because it wasn't alone. Two consecutive quarters of median home price growth haven't occurred in California in two years.
Don't call it a recovery yet, though. The April median for the country's most populous state were still down 36.5% compared to April 2008. On the other hand, 540,360 homes were sold (on a seasonally adjusted, annualized basis), a jump of close to 50% year-over-year. This was the eighth month in a row in which more than 500,000 homes were sold in California. A year ago, the state's inventory of available homes reflected a 9.8 months' supply. In April 2009, it was down to 4.6.
Most of the action, it seems, has been at the bottom of the market. Expensive homes, requiring jumbo mortgages, have had trouble moving.
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