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California Association of Realtors
(excerpts from newsletter of March 13)
Inventory shrinks as pace of new listings drops more than half: Although sales activity has slowed in recent months, the pace of homes being listed for sale continues to slow as well and the dearth of new inventory and supply continues to get tighter. In fact, the number of new listings being added to the MLS each week has been falling by double-digits this whole year and total active inventory has begun to follow suit. Even though buyer demand has softened in the face of rising rates, the market is still seeing enough homes close or enter escrow each week that the net effect relative is that available inventory is shrinking. This will help prevent more significant price declines, though prices are expected to slide further from last year’s peak.
California mortgage delinquencies remain low: Despite a modest uptick in the 4th quarter, mortgage delinquencies remain very low in the Golden State. California finished the year with just 2.5% of mortgages behind on their payments. That was up from 2.2% in the third quarter, but remains well-below the historical average of 4.2% between 1972 and 2000. In addition, California now has the 3rd lowest delinquency rate of any state in the nation, which, taken together with homeowner equity that remains near an all-time high level and most homeowners locked into the lowest rate mortgages of all time, should prevent a flood of inventory from hitting the market and precipitating much larger price declines.
Mortgage applications inch up despite raising rates: Mortgage interest rates climbed for the 5th consecutive week as the average 30-year fixed-rate mortgage nears 7% — the highest level since November of last year. Despite this, mortgage applications inched up according to the latest weekly mortgage applications survey by the Mortgage Bankers Association (MBA).
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