The local domestic market is maintained during the change to the low season.
Even when shifting in slow gear, the Bakersfield real estate market stands out.
Data for October shows that the city’s median sales price declined at a slower pace last month than California as a whole, as local demand for single-family homes actually increased, opposite to the state trend.
Appraiser Gary Crabtree’s report points to a continued imbalance in local housing, and strength in the new construction market, as Bakersfield homebuying moved into the offseason.
Bakersfield’s median sales price last month, defined as the point at which half the homes sold more that month and the other half sold for less, reached $ 340,000, or nine-tenths percent less than in September.
Across the state, October’s rate of decline was slightly more pronounced, at 1.3 percent. On top of that, while California’s sales volume decreased, Bakersfield’s increased slightly.
Crabtree noted the difference between state and local market performance, interpreting Bakersfield as exhibiting “good strength.”
“In my opinion, the basic driver (in) this market is still its affordability,” he summed up in his October report, adding: “Bakersfield’s median price is 57 percent below the state median price, and the data Most recent prices indicate that the Bakersfield market has the third-lowest affordability in the state. ”
Low supply has been a determining factor in Bakersfield for years, and it worsened in October when listings fell nearly 14 percent to 427, which was more than 28 percent lower than the previous year.
Demand measured in total existing-home sales rose just under half a percent last month to 571, or about 13 percent less than a year earlier, according to the Crabtree report.
In particular, the volume of new construction home sales in Bakersfield fell more than 12 percent in October. But at the same time, the median price of a new-build home in the city jumped more than 10 percent to $ 420,000. That’s basically a third higher than the average for the previous year.
Crabtree commented on the trend, noting that the National Association of Home Builders recently reported that construction costs have risen lately. He added that the last home sold locally by an entry-level home builder took place in June, suggesting that buyers may have had to move to higher-priced homes.
Jordan Levine, vice president and chief economist for the California Association of Realtors, which released state figures for October, said in a press release last week that a decline in sales volume was to be expected.
“Despite a slowdown in sales from last year’s robust fall season, the California housing market continues to stabilize and is outpacing pre-pandemic levels seen in 2017, 2018 and 2019,” said Levine.“
The slower sales activity suggests that the market is returning to its typical seasonal pattern and further normalization of the market can be expected in the coming months. While the market shows signs of cooling in recent months, 2021 continues to exceed last year’s sales level so far and is expected to post a profit by the end of the year. ”