Posted by: jhamon | July 6, 2009

California: May Home Sales Limp

From the Field Check Group.  These guys do good work.

May CA Home Sales Anemic

This morning, DataQuick’s CA May home sales report was released to show an anemic 2.9% m-o-m increase in total sales to 39,051. It was the weakest May m-o-m reading in years.  A total of 19,950 were foreclosure resales and 19,091 were organic sales — me selling a home to you.

Organic sales gauge the true health of the housing market and are off 70% from peak levels. Since the beginning of 2009, CA has enjoyed double digit y-o-y comp sales increases but the gap is narrowing and an inflection point is coming in July unless sales can find a way to increase sharply going out of the busy season. I think many will be surprised when the media is reporting negative CA comp sales in July through year end.

Below is a chart of 2006 through 2009 CA house sales. Yes, 2009 (red) is above 2008 (yellow), but 2008 was one of the worst years ever…2006 (blue) was a good year. Total 2009 sales are not as strong as they should be with all of the stimuli being thrown at the housing market.

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