CAR's Pending Home Sales Index in May down 3.1% year-over-year to 122.1, down 3.7% from previous month; share of distressed property sales fell to 21.8%, down from 44.2% a year earlier and 24.4% in April

Allison Oesterle

LOS ANGELES , June 24, 2013 (press release) – The share of equity home sales in California continued to grow in May, making up nearly four of every five home sales. Meanwhile, sales of REOs fell into the single-digits for the second straight month and registered levels not seen since October 2007, the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) reported today.

Distressed housing market data:

• The combined share of all distressed property sales continued to decline in May, dropping to 21.8 percent in May, down from 24.4 percent in April and down from 44.2 percent in May 2012. The share of all distressed sales in 31 of the 36 reported counties also declined significantly from the previous year, with Contra Costa, Marin, San Diego, San Mateo, and Santa Clara recording in the single-digits in May.

• The share of equity sales – or non-distressed property sales – increased further in May and now makes up more than three-fourths of total sales, the highest share since January 2008. The share of equity sales in May increased to 78.2 percent, up from 75.6 percent in April. Equity sales made up more than half (55.8 percent) of all sales in May 2012.

• Of the distressed properties, the share of short sales was 14 percent in May, down from 14.8 percent in April and down from 21 percent a year ago. The May 2013 figure was the lowest since July 2009. The continuing decline in short sales indicates more previously underwater homes are moving into positive equity.

• The share of REO sales fell to single-digits for the second straight month, dropping from 9.2 percent in April to 7.3 percent in May and from 22.8 percent in May 2012.

• The available supply of homes remained tight but was relatively unchanged from April. May’s Unsold Inventory Index for REOs was unchanged at a 1.7-month supply. The supply of short sales dipped from 2.7 months in April to 2.3 months in May. The May Unsold Inventory Index for equity sales was 2.8 months, down from 2.9 months in April.

Pending home sales data:

C.A.R.’s Pending Home Sales Index (PHSI)* edged up 0.3 percent in May to 122.1, up from 121.7 in April, based on signed contracts. Pending sales were down 3.1 percent from the 125.9 index recorded in May 2012. Pending home sales are forward-looking indicators of future home sales activity, providing information on the future direction of the market.

Charts:

• Pending sales compared with closed sales.
• Historical trend in the share of equity sales compared with distressed sales.
• Closed housing sales in May by sales type (equity, distressed).
• Housing supply of REOs, short sales, and equity sales in May.
• A historical trend of REO, short sale, and equity sales housing supply.
• Year to year change in sales by property type.

Share of Distressed Sales to Total Sales
(Single-family)

Type of Sale	May 2013	April 2013	May 2012
Equity Sales	78.2%	75.6%	55.8%
Total Distressed Sales	21.8%	24.4%	44.2%
REOs	7.3%	9.2%	22.8%
Short Sales	14.0%	14.8%	21.0%
Other Distressed Sales (Not Specified)	0.5%	0.5%	0.3%
All Sales	100.0%	100.0%	100.0%

Single-family Distressed Home Sales by Select Counties
(Percent of total sales)

County	May 2013	April 2013	May 2012
Alameda	11%	9%	NA
Amador	NA	40%	50%
Butte	20%	27%	37%
Contra Costa	9%	11%	NA
El Dorado	21%	22%	47%
Fresno	38%	38%	57%
Humboldt	16%	20%	34%
Kern	25%	31%	48%
Kings	38%	40%	NA
Lake	36%	49%	70%
Los Angeles	23%	24%	41%
Madera	52%	47%	79%
Marin	8%	10%	21%
Mendocino	31%	24%	44%
Merced	32%	44%	54%
Monterey	29%	37%	52%
Napa	20%	23%	44%
Orange	14%	13%	33%
Placer	21%	23%	47%
Riverside	29%	32%	54%
Sacramento	29%	32%	58%
San Benito	30%	22%	59%
San Bernardino	32%	35%	59%
San Diego	7%	10%	23%
San Joaquin	36%	43%	62%
San Luis Obispo	15%	17%	35%
San Mateo	4%	11%	21%
Santa Clara	7%	10%	28%
Santa Cruz	10%	18%	33%
Siskiyou	30%	34%	54%
Solano	36%	43%	70%
Sonoma	19%	22%	45%
Stanislaus	40%	37%	65%
Tehama	NA	NA	65%
Tulare	37%	34%	56%
Yolo	25%	34%	45%
California	22%	24%	44%

NA = not available

**Note: C.A.R.’s pending sales information is generated from a survey of more than 70 associations of REALTORS® and MLSs throughout the state. Pending home sales are forward-looking indicators of future home sales activity, offering solid information on future changes in the direction of the market. A sale is listed as pending after a seller has accepted a sales contract on a property. The majority of pending home sales usually becomes closed sales transactions one to two months later. The year 2008 was used as the benchmark for the Pending Homes Sales Index. An index of 100 is equal to the average level of contract activity during 2008.

Leading the way...® in California real estate for more than 100 years, the CALIFORNIA ASSOCIATION OF REALTORS® (www.car.org) is one of the largest state trade organizations in the United States with 155,000 members dedicated to the advancement of professionalism in real estate. C.A.R. is headquartered in Los Angeles.

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