Prices are down 20%-plus in most California cities year-over-year, but volumes are up more than 100% year-over-year. As a new California Association of Realtors release points out, October sales in the state are back to 552,750 homes on an annualized basis. That is the highest volume since late 2005.
Of course, the volume is all foreclosures. And yes, annualizing a foreclosure spike is silly. No question. But itâ€™s at least worth noting that California banks are aggressively unloading foreclosed inventory. Trouble is there is an excellent chance many new buyers go straight back into default on lower prices, but letâ€™s save that problem for another day.
As a related aside, here are the five California cities with the highest (!) price increases in the period:
- Mountain View, 18.6 percent
- Alhambra 13.4 percent
- Ridgecrest 6.2 percent
- Berkeley, 5.9 percent
Please tell me that this is on negligible volume.