C.A.R. REPORTS SALES DECREASE 38.9 PERCENT, MEDIAN HOME PRICE FALLS 4.7 PERCENT

Home sales decreased 38.9 percent in September in California compared with the same period a year ago, while the median price of an existing home fell 4.7 percent, C.A.R. reported today.

"While it is typical for the median price to dip seasonally as we move from August to September, this decline -- which was both the largest month-to-month percentage decline on record and the first year-to-year decline in more than 10 years -- was mainly the result of the credit or liquidity crunch, which also drove sales below the 300,000 mark," said C.A.R. President Colleen Badagliacco.

"California's sales fell more steeply than those of the U.S. as a whole because of its heavy reliance on jumbo loans -- those above the conforming loan limit of $417,000," she said. "This speaks to the need to raise the conforming loan limit in higher-cost states like California to more accurately reflect the cost of housing."

C.A.R.'S 2008 CALIFORNIA HOUSING MARKET FORECAST

Home prices throughout most of California will post modest declines next year while sales of existing homes will stabilize from the precipitous decrease experienced in 2007, according to C.A.R.'s "2008 California Housing Market Forecast" released today.

The median home price in California will decline 4 percent to $553,000 in 2008 compared with a projected median of $576,000 this year, while sales for 2008 are projected to decrease 9 percent to 334,500 units, compared with 367,500 units (projected) in 2007.

"Tighter credit standards, affordability concerns, and a continued standoff between buyers and sellers will contribute to continued weakness in the market going into next year," said C.A.R. President Colleen Badagliacco. "Now is not the time for homeowners to test the waters, only serious sellers should put their homes on the market in what will continue to be a challenging sales environment."

Fast Facts

Calif. median home price - August 07: $588.970(Source: C.A.R.)

Calif. highest median home price by C.A.R. region August 07: Santa Barbara So. Coast $1,262,500(Source: C.A.R.)

Calif. lowest median home price by C.A.R. region August 07: High Desert $287.39(Source: C.A.R.)

Calif. First-time Buyer Affordability Index - Second Quarter 07: 24 percent (Source: C.A.R.)

Mortgage rates - week ending 10/04: 30-yr. fixed: 6.37%; Fees/points: 0.5% 15-yr. fixed: 6.03%; Fees/points: 0.5% 1-yr. adjustable: 5.58%; Fees/points: 0.7% (Source: Freddie Mac)