Fierce competition in the California housing market in March drove the state’s median home price to a new record high while sales remained solid heading into the spring homebuying season, according to the monthly home sales and price report from the California Association of REALTORS® (C.A.R.).

The statewide median home price in March reached a new all-time high of $758,990.

Similarly, the median home price in San Diego in March rose to a new record of $800,000.

In addition, nearly two-thirds or 63 percent of homes sold above the asking price in March 2021, reflecting the combination of intense demand and short supply. California already had set a record for share of home selling over listing price at 56 percent in February 2021.

Closed escrow sales of existing, single-family detached homes in California totaled a seasonally adjusted annualized rate of 446,410 in March 2021, down 3.5 percent from 462,720 in February 2021 but were up 19.7 percent from March 2020, when 373,070 homes were sold. The annualized sales figure represents what would be the total number of homes sold during 2021 if sales maintained the March pace throughout the year.

The monthly sales decline was the third in a row, and the sales pace was the lowest since last July. The nearly 20 percent sales gain was attributed to weak home sales a year ago as the coronavirus outbreak abruptly halted the real estate market and economy, CAR said.  

March 2021 County Sales and Price Activity
(Regional and condo sales data not seasonally adjusted)

Meanwhile, California’s median home price set another new record high in March 2021 as the statewide median price surged nearly 24 percent from a year ago. The statewide median home price in March 2021 climbed 8.6 percent on a month-to-month basis to $758,990, up from $699,000 in February 2021 and up 23.9 percent from the $612,440 recorded in March 2020. 

The year-over-year statewide gain, from March 2020 to March 2021, was the highest since October 2013 and it was the eighth straight month that California’s median price registered a double-digit gain.

In San Diego County, the number of home sales in March 2021 was 29.3 percent higher compared to February 2021 and 18.1 percent higher compared to March 2020.

San Diego’s median price for a single-family detached home in March 2021 was a record high of $800,000, which was $35,000 or 4.6 percent higher than the median home price of $765,000 in February 2021 and 18.5 percent higher compared to $675,000 in March 2020.

The median price represents the point at which half of homes sell above a price, and the other half below it.

“While intense homebuying interest is the engine that continues to drive housing demand, a shortage of homes for sales is the rocket fuel pushing prices higher across the state. A lack of homes for sale is creating unprecedented market competition, leading to a record share of homes selling above asking price in March,” said C.A.R. President Dave Walsh, vice president and manager of the Compass San Jose office. “With more of the state’s COVID-19 restrictions being lifted in the coming months as we move into the spring home buying season, we should see home sales improve as more prospective home sellers feel comfortable listing their homes for sale.” 

“The market sentiment is drastically different today compared to a year ago at the onset of the pandemic,” said C.A.R. Vice President and Chief Economist Jordan Levine. “With the U.S. economy positioned to grow at the fastest pace since the early 1980s and mortgage rates trending down again in the past week, consumer confidence will improve further, so in the coming months, we should continue to see a solid bounce-back from last year as the market maintains its momentum.”

Other key points from C.A.R.’s March 2021 resale housing report included:

-- Home sales in March from a regional perspective experienced a double-digit sales surge compared to a year ago. The San Francisco Bay Area had the highest year-over-year gain, at a growth rate of 35.0 percent from March 2020. The Central Coast (31.8 percent), Far North (26.1 percent), and Southern California regions (23.3 percent) experienced a sales increase of more than 20 percent from last year.

-- Home sales in resort markets remained robust in March, with Big Bear, Lake Arrowhead and South Lake Tahoe all increasing more than 50 percent from a year ago. South Lake Tahoe was particularly strong in March 2021 with sales rising 128.1 percent compared to March 2020. Lake Arrowhead also had a strong month of March with sales growing near triple-digits year-over-year, while Big Bear increased by 54.8 percent and Mammoth Lakes jumped by 16.7 percent.

March 2021 County Unsold Inventory and Days on Market
(Regional and condo sales data not seasonally adjusted)

-- All major regions recorded double-digit increases in the median price increases from last year. The Central Coast region posted the highest year-over-year growth rate of 26.4 percent, followed by the San Francisco Bay Area (21.3 percent), Southern California (20.5 percent), the Central Valley (18.6 percent) and the Far North (12.4 percent).

-- All 51 counties tracked by C.A.R. reported a gain in median price on a year-over-year basis, with 45 of them increasing more than 10 percent.

-- Active listings statewide fell 51.1 percent in a comparison between March 2021 and March 2020. It was the third consecutive month that listings declined more than 50 percent. On a month-to-month basis, for-sale properties inched up by 5.3 percent in March.

-- The available supply of homes for sale continued to tighten up across the state, with all major regions near record low levels. Forty-nine of the 51 counties covered by C.A.R. recorded a decline in active listings on a year-over-year basis in March, and 30 of them dropped more than half from levels a year ago.

-- Statewide, the unsold inventory of available homes for sale dropped to 1.6 months in March from 2.0 months in February and was down sharply from a year ago, when there was 2.7 months of housing inventory. Inventory levels measured in months indicate the number it would take for the available supply of homes on the market to sell-out given the current rate of sales.

-- In San Diego County, the inventory of available homes for sales in March 2021 dropped to 1.5 months, compared to 1.8 months in both February 2021 and January 2021 and 2.4 months in March 2020.

-- The median number of days it took to sell a California single-family home in March 2021 hit a record of eight days, the lowest every recorded. The eight-day figure compared to 10 days in February 2021, 11 days in January 2021, 11 days in December 2020, nine days in November 2020, 10 days in October 2020, 11 days in September 2020 and 15 days in March 2020. Prior to March 2021, the previous statewide record was nine days in November 2020.

-- In San Diego County, the median number of days an existing, single-family home remained unsold on the market was six days in March 2021. That number compares to seven days in both February 2021 and January 2021, as well as eight days in December 2020 and seven days in November, October and September 2020. The timeframe a year ago in March 2020 was 10 days.

-- The 30-year, fixed-mortgage interest rate averaged 3.08 percent in March, down from 3.45 percent in March 2020, according to Freddie Mac. The five-year, adjustable mortgage interest rate was an average of 2.78 percent, compared to 3.16 percent in March 2020.

California’s home sales and prices eased in February as mortgage rates spiked, while strong buying interest continued and tight housing supply restrained demand, especially in more affordable markets.

According to its monthly home sales and price report released this week by the California Association of REALTORS® (C.A.R.), the state’s housing market has recently encountered some speed-bumps due to rising mortgage interest rates.

Closed escrow sales of existing, single-family detached homes in California totaled a seasonally adjusted annualized rate of 462,720 in February 2021, which was down 4.5 percent from 484,760 in January 2021, but 9.7 percent higher from February 2020, when 421,670 homes were sold on an annualized basis.

It was the eighth straight month for year-over-year gain in home sales. However, February’s nearly 10 percent home sales increase from a year ago was the smallest gain in the past seven months. Year-to-date statewide home sales were up 15.9 percent in February.

The statewide annualized sales figure represents what would be the total number of homes sold during 2021 if sales maintained the February pace throughout the year. It is adjusted to account for seasonal factors that typically influence home sales.

Meanwhile, California’s median home price in February 2021 was essentially unchanged from January 2021, but was 20.6 percent higher than in the $579,770 figure for February 2020, recording the first back-to-back 20 percent yearly increase since February 2014. The statewide median home price dipped 0.1 percent on a month-to-month basis to $699,000 in February 2021, down from $699,920 in January 2021.

February 2021 County Sales and Price Activity
(Regional and condo sales data not seasonally adjusted)

The double-digit statewide increase from last year was the seventh in a row and the second largest since February 2014.

In San Diego County, February 2021 home sales were 6.1 percent higher, compared to January 2021, and 12.8 percent higher compared to February 2020.

San Diego’s median price for a single-family detached home was $765,000 in February 2021, a 4.8 percent increase from $730,000 in January 2021, and a 14.2 percent increase from $670,000 in February 2020.

The median price represents the point at which half of homes sell above a price, and the other half below it.

“The housing market has been cruising at a robust pace since the second half of 2020 but has encountered some speed-bumps recently as rates began to rise,” said C.A.R. President Dave Walsh, vice president and manager of the Compass San Jose office. “While higher rates may slow growth in home sales temporarily, the major roadblock in the long run is a shortage of homes for sale. With inventory dropping more than a half from a year ago, the market will soften in the second half of 2021 if we don’t see enough homes come on the market to meet demand.”   

“The upward movement in rates has called into question whether the market will sustain its momentum going into the spring homebuying season,” said C.A.R. Vice President and Chief Economist Jordan Levine. “While rates are off their record lows, they are still relatively low by historical standards. Recent increases in mortgage rates will likely slow the pace of price growth in the coming months but will also motivate those who truly want to buy to enter the market before rates start moving further up.”

Other key points from C.A.R.’s February 2021 resale housing report included:

-- Home sales from a regional perspective surged in February, compared to a year ago. The Central Coast region posted the highest year-over-year sales gain, with a growth rate of 22.4 percent. The Far North (17.3 percent), the San Francisco Bay Area (16.1 percent), and Southern California (10.5 percent) regions also experienced double-digit year-over-year increases in sales from a year ago.

-- Resort marks continued to perform well in February. Sales growth in the resort markets was relatively strong when compared to the rest of California. South Lake Tahoe (56.7 percent), Lake Arrowhead (44.1 percent), and Big Bear (36.1 percent) all experienced sales increases of more than 35 percent from a year ago. The exception was Mammoth Lakes were sales were flat in February 2021. However, aggregated sales for the first two months of 2021 in mountain resort communities are up 40 percent from the same period last year.

-- All major regions recorded double-digit increases in the median price increased from last year with the San Francisco Bay Area growing the strongest at 26.5 percent. The year-over-year increase in the Bay Area’s median price was the largest since September 2013, and it helped to set a new record high in the median price for the Bay Area. The Central Valley region had the second highest price growth rate of all regions with its median price increasing 19.1 percent year-over-year in February, followed by Southern California (16.4 percent), the Central Coast (15.9 percent) and the Far North (11.7 percent).

-- Active listings statewide fell 52.5 percent in February 2021, compared to February 2021. It was a decline of more than 40 percent on a year-over-year basis for the eighth consecutive month. On a month-to-month basis, for-sale properties inched up slightly by 0.4 percent in February 2021 and should climb further in the coming months as the market prepares for the spring homebuying season and the pandemic situation continues to improve.

-- The unsold inventory of available homes for sale inched higher to 2.0 months in February 2021, from 1.9 months in January 2021. However, inventory levels in February 2021 were sharply lower than in February 2020, when there was 3.6 months of housing inventory. Inventory levels measured in months refers to the number it would take for the current supply of available homes on the market to sell-out given the current rate of sales.

February 2021 County Unsold Inventory and Days on Market
(Regional and condo sales data not seasonally adjusted)

-- In San Diego County, the inventory of available homes for sale remained at 1.8 months for February 2021, which was the same figure for January 2021. That compares to 1.2 months in December 2020, 1.6 months in November 2020, 1.8 months in October 2020 and 3.0 months in February 2020.

-- The median number of days it took to sell a California single-family home was 10 days in February 2021, compared to a revised 11 days in January 2021, 11 days in December 2020, nine days in November 2020, 10 days in October 2020, 11 days in September 2020 and 23 days in February 2020. The nine-day November 2020 statewide figure was the lowest ever recorded.

-- In San Diego County, the median number of days an existing, single-family home remained unsold on the market was seven days in February 2021, which was the same figure for January 2021. That compares to eight days in December 2020, seven days in November, October and September 2020. The timeframe a year ago in February 2021 was 12 days.

-- The 30-year, fixed-mortgage interest rate averaged 2.81 percent in February, down from 3.47 percent in February 2020, according to Freddie Mac. The five-year, adjustable mortgage interest rate was an average of 2.83 percent, compared to 3.26 percent in February 2020.

Although 2020 will be remembered as a surreal year of setbacks and hardships when a brutal pandemic changed the world amid government-imposed lockdowns, it was a terrific final month on the calendar for California’s housing market.

According to the most recent monthly home sales and price report from the California Association of REALTORS^® (C.A.R.), released Friday, the state’s housing market closed out 2020 on a high note with solid home sales in December, plus a record-high median home price for the fifth time in the year.

December 2020’s statewide sales total exceeded the 500,000-units benchmark for the second month in a row. Closed escrow sales of existing, single-family detached homes in California totaled a seasonally adjusted annualized rate of 509,750 units in December 2020. It was an increase of 0.2 percent from 508,820 in November 2020, and 28 percent higher from December 2019, when 393,370 homes were sold on an annualized basis.

The year-over-year, double-digit sales gain marked the fifth consecutive month and the largest yearly gain since May 2009.

For the 2020 year, annual home sales rose to a preliminary 411,870 closed escrow sales in California, up 3.5 percent from 2019’s pace of 397,960.

Meanwhile, California’s median home price set another record in December 2020, after dipping below the $700,000 benchmark the previous month. The statewide median home price rose 2.7 percent on a month-to-month basis to $717,930 in December 2020, up from $698,890 in November 2020. Home prices continued to gain on a year-over-year basis with the statewide median price surging 16.8 percent from $614,880 recorded in December 2019.

The double-digit increase in a year-over-year comparison was the fifth in a row, and the month-to-month gain was higher than the long-run average of 0.8 percent observed between 1979 and 2019.

For the 2020 year, the statewide median home price was $659,380, an increase of 11.3 percent from a revised $592,230 in 2019.

In San Diego County, December 2020 home sales were 4.4 percent higher compared to November 2020 and 30.3 percent higher than in December 2019.

The median home price for a single-family detached home in San Diego County dropped slightly in December 2020 to $730,000, compared to $740,000 in November 2020, a 1.4 percent decrease, but a 11.5 percent increase from December 2019’s figure of $655,000.

December 2020 County Sales and Price Activity
(Regional and condo sales data not seasonally adjusted)

“It’s a testament to the strength of the market that even after the pandemic effectively shut down the spring home-buying season in 2020, the market still was able to recover the substantial sales lost in the first half of the year and even top 2019’s levels,” said C.A.R. President Dave Walsh, vice president and manager of the Compass San Jose office. “With mortgage rates expected to stay near the lowest in history, demand for homeownership will continue to be strong, so home sales should remain elevated into the first half of 2021, as motivated buyers take advantage of the increased purchasing power.”

“Home prices, which usually peak during the summer, were unseasonably strong in December,” said C.A.R. Vice President and Chief Economist Jordan Levine. “The imbalance between supply and demand continues to fuel home price gains as would-be home sellers remain reluctant to list their homes during the pandemic, contributing to a more-than-40-percent year-over-year decline in active listings for the seventh straight month.”

Perhaps due to increasing home prices, more consumers said it is a good time to sell, according to C.A.R.’s monthly Consumer Housing Sentiment Index. Conducted in early January, the poll found that 59 percent of consumers said it is a good time to sell, up from 55 percent a month ago, and up from 56 percent a year ago. Meanwhile, low interest rates continue to fuel the optimism for homebuying; one-fourth of the consumers who responded to the poll believed that now is a good time to buy a home, unchanged from last year.

Other key points from C.A.R.’s December 2020 resale housing report included:

-- Home sales from a regional perspective increased by double-digits in all major regions in December 2020, with a year-over-year gain of at least 20 percent in nearly every region. The San Francisco Bay Area remained on top with the highest gain of 40.2 percent over last year, followed by Southern California (31.4 percent), the Far North (30.8 percent) and the Central Valley (22.2 percent).

-- Median home prices from a regional perspective also posted increases in December 2020 by more than 10 percent in year-over-year comparisons. The Central Coast region had the largest year-over-year price increase, gaining 17.9 percent from a year ago. The San Francisco Bay Area had the second largest increase of 16.4 percent, followed by the Central Valley (15.5 percent), the Far North (15.2 percent) and Southern California (13.0 percent).

-- Active listings declined in December 2020 as expected during the holiday season. Active listings fell 47.1 percent in December 2020, compared to December 2019 from last year and continued to drop more than 40 percent on a year-over-year basis for the seventh straight month. On a month-to-month basis, for-sale properties dropped 18.6 percent in December 2020, higher than the five-year average of -14.0 percent, observed between 2015 and 2019.

-- The unsold inventory of available homes for sale dropped to 1.3 months in December 2020, matching the record-low set in 2004. Statewide inventory in November 2020 was 1.9 months. Inventory levels measured in months refers to the number it would take for the current supply of available homes on the market to sell-out given the current rate of sales. C.A.R. said the surge in the coronavirus cases played a role in the decrease in active listings as homeowners remain concerned about the worsening coronavirus pandemic situation.

December 2020 County Unsold Inventory and Days on Market
(Regional and condo sales data not seasonally adjusted)

-- In San Diego County, the inventory of available homes for sale in December 2020 was 1.2 months, compared to 1.6 months in November 2020, 1.8 months in October 2020 and 2.2 months in December 2019.

-- The median number of days it took to sell a California single-family home was 11 days in December 2020, compared to nine days in November 2020, 10 days in October 2020, 11 days in September 2020 and 28 days in December 2019. The nine-day November 2020 figure was the lowest ever recorded.

-- In San Diego County, the median number of days an existing, single-family home remained unsold on the market was eight days in December 2020, compared to seven days in November, October and September 2020. The timeframe a year ago in December 2019 was 20 days. The December 2020 eight-day figure also compares to eight days in August 2020, 10 days in July 2020, 12 days in June 2020, 11 days in May 2020, eight days in April 2020, 10 days in March 2020, 12 days in February 2020 and 23 days in January 2020.

-- With homebuying interest remaining high, the housing market in Californian’s mountain resort areas in December 2020 continued to exhibit strong gains compared to December 2019. Mammoth Lakes saw the biggest year-over-year sales increase in December 2020, surging 116.7 percent from the same month a year ago, followed by Lake Arrowhead (78.6 percent), Big Bear (54.1 percent) and South Lake Tahoe (31.7 percent).

-- Overall for the year 2020, home sales in mountain resort communities increased 92.7 percent in Big Bear, 51 percent in Lake Arrowhead, 49.5 percent in South Lake Tahoe and 37.5 percent in Mammoth Lake.

-- The 30-year, fixed-mortgage interest rate averaged 2.68 percent in December, down from 3.72 percent in December 2019, according to Freddie Mac. The five-year, adjustable mortgage interest rate was an average of 2.79 percent, compared to 3.39 percent in December 2019.

In other recent real estate and economic news, according to news reports:

-- If a COVID-19 vaccine distribution proves successful, Fannie Mae economists are expecting the U.S. economy is poised for a strong year in 2021. Consumer spending is expected to accelerate during the spring, ultimately driving a considerably faster pace of growth in the second half of 2021.

-- The number of active listings in San Diego declined 20.6 percent in December 2020 in a year-over-year comparison, according to Realtor.com. Nationwide, the percentage decline for housing inventory in December was 39.6 percent year-over-year. The number of new listings can vary greatly from market to market. In December, San Jose, Calif. saw its new listing count climb by 123.8 percent and San Francisco-Oakland’s market increased by 98.9 percent.

-- The median monthly rent in San Diego was $2,355 in November 2020, which was a 3.8 percent year-over-year increase, according to Zillow. San Diego is the 8th most expensive city to rent an apartment, according to Zumper. Zumper’s report said the rental rate for a one-bedroom unit in San Diego grew 0.6 percent to $1,800 a month in December, while a two-bedroom's monthly rate increased 2.6 percent to $2,400.

-- Home prices continue to rise faster than wages across the nation, according to Attom Data Solutions. In the 2020 fourth quarter, home-ownership expenses consumed 29.6 percent of the average wages, compared to 26.4 percent in 4Q 2019. For the 4Q 2020 timeframe, homeownership costs exceeded an industry standard of 28 percent in 55 percent of U.S. counties, up from 43 percent in 2019 and 33 percent three years ago.

-- San Diego home prices are expected to rise by 8.3 percent in 2021, according to CoreLogic. The increase is the most of any other U.S. major city. The main reason is the lack of homes for sale will continue to push up prices. A secondary reason is income inequality. The pandemic has benefited high-wage workers who have been able to work from home, while low-wage workers lost income because their jobs were among the first shuttered during government-imposed shutdowns. Other cities with expected home price increases in 2021 include Miami (3.2 percent), Los Angeles (3.2 percent) and Washington, D.C. (2.9 percent), while the national average is expected to be around 2.5 percent. In contrast, Houston, hit hard by declines in the oil industry and the recent hurricane season, will see prices decrease 1.4 percent.

More than 100 PSAR members learned more about property tax benefits available to clients of REALTORS^® from Proposition 19 during a Zoom meeting earlier this week with Taxpayer Advocate Jordan Marks of the San Diego County Accessor-Recorder-County Clerk (ARCC) Office.

Recorded Video of the Presentation

Attachments from the presentation:

• Jordan Marks Presentation Slides
• Assessor Homeowners Exemption Form
• Assessor Senior Exclusion Form
• Prop 58 Parent to Child Exclusion Form

Prop. 19, approved by California voters in the recent November general election, offers significant benefits to homeowners and sellers. The ballot measure was endorsed by the California Association of REALTORS^® (C.A.R.) and other business and community organizations because it will spur housing economic recovery.

Simply put, Prop. 19 expands the affordable housing tools by allowing senior homeowners over 55 years old, people with severe disabilities and victims of natural disasters or wildfires to keep their low tax base and move or rebuild anywhere statewide.

In addition, Prop. 19 addressed a tax loophole allowing families to pass their homes and affordable tax bases to their children, but no longer allowing them to be used for a commercial purpose.

However, Marks told PSAR members that it’s important to remember that some rules relating to Prop. 19 will change on Feb. 15 and April 1.

Before Feb. 15, in the case of transferring home ownership from parent to child or grandparent to grandchild, the law allows for unlimited transfer of assessed value on a primary resident with no requirement to live in the property and up to $1 million of assessed value on all non-primary residential properties.

After Feb. 15, the law changes with a limit of $1 million transfer of assessed value on a primary resident, plus a requirement to live in the property and no transfer of assessed value on any property not a primary resident.

Before April 1, for relocating homeowners over 55 years old, the current rules limit the senior exclusion from property tax reassessment to one time plus a requirement to live in the property.

After April 1, the senior exclusion from property tax assessment can be claimed for three times for any property in the state (but unlimited times for those whose homes were destroyed or substantially damaged by a wildfire or natural disaster). Filing for the exclusion must occur within two years from the date of the sale or purchase.

Starting January 8th 2021 (ran out of funds mid January), you can apply on behalf of your clients for the California Association of REALTORS^® Housing Affordability Fund (HAF) Home Essentials Program.  

• Be a first-time homebuyer
• Homebuyers must use a California REALTOR^® in the transaction
• Purchase a primary single-family residence in California with the intent to occupy the property as a primary residence
• The conforming loan amount on the single-family residence must be at or below the FHA conforming loan limit
• The purchase of the single-family residence must use financing. All-cash purchases do not qualify

Starting December 30th, 2020, REALTORS^® can apply for California’s new relief grant program for small businesses affected by the COVID-19 pandemic. The program provides micro grants ranging from $5,000 to $25,000 to eligible small businesses (including independent contractors and sole proprietors) impacted by COVID-19 and the related health and safety restrictions. The grant amount will be based on the business’s annual revenue as documented in its most recent tax return:

• For annual revenue of $1,000 to $100,000, the available grant amount is $5,000.
• For annual revenue of greater than $100,000 up to $1,000,000, the available grant amount is $15,000.
• For annual revenue of greater than $1,000,000 up to $2,500,000, the available grant amount is $25,000.

A small business must satisfy certain criteria to be eligible to receive a grant award — read the criteria in full here. Please keep in mind that even if you meet all eligibility requirements, it is not guaranteed you will receive a grant.

Applications for the program must be submitted through a Community Development Financial Institution (CDFI) that has partnered with the state of California to distribute the funds. The list of partners, organized by location and by language services, can be found here.

The first round for applications opens on December 30, 2020, at 8:00 a.m. and closes on January 8, 2021, at 11:59 p.m. Approval notifications will begin on January 13, 2021. There will be a second round for application submissions and reviews, although the dates for that round have not yet been announced.

See the grant California Small Business COVID-19 Relief Grant Program website for more information.

Landlords and tenants alike have been hit hard with economic challenges resulting from the Covid-19 pandemic. Fortunately, several local cities and nonprofits who administer federal government programs on behalf of cities, have made rental assistance resources available to both landlords and tenants who have suffered Coved-related economic losses. PSAR members active in their communities should be aware of these following landlord/tenant resources:-- In San Diego, With funding from the federal government, the San Diego Housing Commission (SDHC) helps more than 16,000 households with low income pay their rent in the City of San Diego. Through this rental assistance program, SDHC made payments totaling more than $166 million to more than 5,800 participating landlords on behalf of low-income families during Fiscal Year 2020 (July 1, 2019 – June 30, 2020).

In 2019, SDHC expanded its focus on landlord outreach and engagement with the creation of the Landlord Services Unit. This unit is composed of seven specialized staff who provide quality customer service to landlords and tenants participating in the Section 8 Housing Choice Voucher rental assistance program. For more details about SDHC rental assistance resources for properties located within the City of San Diego, contact SDHC, www.sdhc.org or call 619-578-7131.

The SDHC Landlord Services Unit manages the agencies Landlord Partnership Program (LPP), which provides financial and support incentives to landlords who rent to families who receive federal rental assistance through the Section 8 Housing Choice Voucher program within the San Diego city limits (92037 and ZIP codes that begin with “921”, except for 92118). Landlords who participate in the LPP may be eligible to receive up to $500 for each rental unit rented to a Section 8 household and up to $3,000 to help cover repair expenses in excess of normal wear and tear and rent due that exceeds the security deposit following tenant move-out. For more information about LPP, please visit https://www.sdhc.org/doing-business-with-us/landlords/landlord-partnership-program/

SDHC’s services to landlords include consistent and on-time rent payment, access to an online landlord portal, and enhanced customer service.

-- In National City, South Bay Community Services (SBCS) launched a tenant-based rental assistance program in National City. The City of National City has reached out to PSAR seeking assistance in contacting property managers and management companies who have tenants with past due rent.

SBCS is now accepting applications for a COVID-19 Tenant Based Rental Assistance Program funded by the City of National City. This program will assist low-income families in who have suffered a loss in income or are unable to pay their past due rent because of Covid-related financial issues. You can help by notifying tenants that this rental assistance is available. Applications can be found at https://southbaycommunityservices.org/national-city-rental-assistance/. Application assistance is available in person at the National City Family Resource Center (304 W. 18th Street, National City), at  rentalassistance@csbcs.org, or by phone: (619) 336-8360
-- In Chula Vista, the city is developing its long-term strategic plan for housing and determining housing dollars usage, according to the city website. Earlier this year, the  Chula Vista City Council enacted a temporary eviction moratorium in response to Covid-19. The city’s moratorium, which provided eviction protection for residents and commercial tenants, was superseded and replaced with AB 3088, known as “The Tenant, Homeowner and Small Landlord Relief and Stabilization Act of 2020.” The law signed by Gov. Newsom on Aug. 31, protects renters, homeowners and small landlords through January 2021.

Chula Vista used a portion of the $3.3 million it received from the CARES Act to lend financial support to South Bay Community Services (SBCS), who assists residents with rent payments. An additional CARES Act allotment arrived Nov. 1, allowing SBCS to accept additional applications for rental assistance from those suffering economically from Covid-19 effects.-- In El Cajon, several nonprofits who have contracts with the city are assisting El Cajon residents with rent payments. The nonprofits include Home Start (619-430-0032), Interfaith Shelter Network (619-702-5399) CSA San Diego County (619-444-5700). Earlier this year, the El Cajon City Council allocated $800,000 in special block grant funding to those impacted financially by the Covid pandemic.-- In La Mesa, Home Start is overseeing a Rental Assistance Program. Applicants may qualify for up to three months of past-due rent assistance for those who have experienced job loss and/or other Covid-related financial challenges. Earlier this year, the La Mesa City Council approved $1.8 million in Coronavirus Aid Relief and Economic Security Act funding to businesses and residents. A portion of that money, roughly $600,000, was allocated to rental assistance to help people avoid eviction and homelessness. 
-- In Lemon Grove, Home Start is supporting the city’s rental assistance efforts. The Lemon Grove City Council allocated $100,000 of $162,371 in Federal Coronavirus Aid, Relief, and Economic Security Act funds to Home Start to help individuals needing hotel vouchers, transportation, reunification efforts and emergency items such as food, blankets and diapers. Funds are also available to those who need rental and utility assistance.

_______________________

California’s housing market remained red hot in November 2020 with statewide home sales reaching the highest level in 15 years. Record-low mortgage rates and flexibility to work from home has driven home-buying interest to levels not seen since the last decade, according to the California Association of REALTORS^® (C.A.R.).

November 2020’s statewide sales total broke the 500,000-units benchmark for the first time since January 2009.

Closed escrow sales of existing, single-family detached homes in California totaled a seasonally adjusted annualized rate of 508,820 for November 2020. It was an increase of 5 percent from 484,510 homes in October, and 26.3 percent higher from November 2019, when 402,880 homes were sold.

The year-over-year, double-digit home sales gain recorded in November was the fourth consecutive month and the largest increase over a year’s time since May 2009.

Meanwhile, California’s median home price for November 2020 dipped slightly after breaking the $700,000 benchmark over the past three months. The statewide median price dropped to $699,000 in November 2020, down 1.7 percent from $711,300 in October 2020.

However, home prices continued to gain on a year-over-year basis with the statewide median price surging 18.5 percent from $589,770 recorded in November 2019. The double-digit increase from 2019 was the fourth month in a row and the highest 12-month gain since February 2014. The gain was also higher than the six-month average of 9.7 percent observed between May 2020 and October 2020. 

November 2020 County Sales and Price Activity
(Regional and condo sales data not seasonally adjusted)

In San Diego County, November 2020 home sales decreased 7.8 percent, compared to October 2020, but increased 23.2 percent higher than in November 2019.

Similarly, the median home price for a single-family home in San Diego County dropped slightly in November 2020 to $740,000, a 1.2 percent decrease from October 2020’s figure of $749,000, but a 12.3 percent increase from November 2019’s figure of $659,000.

“Home-buying interest is at levels that we have not seen for years, setting the stage for a stronger-than-expected comeback that fully recovered all the sales that the market lost in the first half of the year due to the pandemic,” said 2021 C.A.R. President Dave Walsh, vice president and manager of the Compass San Jose office. “Housing supply remains an issue, however, as we will likely to see a shortage of homes for sale in the near term, which will put upward pressure on prices and dampen affordability for those who haven’t been able to take advantage of low rates.”

“California’s housing market continues to be the bright spot in the economy, but the direction and pace of the recovery will hinge on the coronavirus pandemic and the distribution of the vaccine in the coming months,” said C.A.R. Senior Vice President and Chief Economist Leslie Appleton-Young. “The rise in COVID-19 cases and tighter constraints on economic activity recently imposed will likely have implications for the housing market as renters and homeowners face adverse impacts to their incomes, which is why Congress should pass additional relief for renters, homeowners, and workers as soon as possible.”

Perhaps due to rising cases of the Coronavirus, fewer consumers said it is a good time to sell in December, according to C.A.R.’s monthly Consumer Housing Sentiment Index. Conducted in earlier this month, the poll found that 55 percent of consumers said it is a good time to sell, down from 59 percent a month ago, but up from 51 percent a year ago. Meanwhile, low interest rates continue to fuel the optimism for homebuying; just over one-fourth (27 percent) of the consumers who responded to the poll believed that now is a good time to buy a home, up from last year, when 24 percent said it was a good time to buy a home.

Even with low inventory levels, the coronavirus pandemic has increased the demand for spacious, multi-functional homes as more homeowner families are dealing with homebound distance learning for school and working remotely for the job.

Other key points from C.A.R.’s November 2020 resale housing report included:

-- Home sales from a regional perspective continued to increase in November 2020 by double-digits in year-over-year comparisons for most California regions. The San Francisco Bay Area had the highest gain of 34.4 percent over last year, followed by the Central Coast (33.4 percent), Southern California (19.1 percent) and the Central Valley (18.3 percent).

-- Median home prices from a regional perspective also posted double-digit increases in November 2020 in year-over-year comparisons. The San Francisco Bay Area median price remained at its record high in November, rising 18.9 percent from last year. The Central Coast region had the second largest median price increase at 18.7 percent, followed by the Central Valley (17.6 percent), Southern California (14.4 percent), and the Far North (13.6 percent).

-- With a resurgence in Covid-19 cases in recent weeks and the market entering the traditional holiday season, active listings declined from the prior month as expected, contributing to a substantial decline in inventory. Active listings fell 46.6 percent from last year and continued to drop more than 40 percent on a year-over-year basis for the sixth straight month.

-- The unsold inventory of available homes for sale fell sharply from 3.1 months in November 2019 to 1.9 months in November 2020. Statewide inventory in October 2020 was 2.0 months. Inventory levels measured in months refers to the number it would take for the current supply of available homes on the market to sell-out given the current rate of sales.

November 2020 County Unsold Inventory and Days on Market
(Regional and condo sales data not seasonally adjusted)

-- In San Diego County, the inventory of available homes for sale in November 2020 was 1.6 months, compared to 1.8 months in October 2020 and 2.7 months in November 2019.

-- Active listings in all major California regions continued to decline in November 2020 in year-over-year comparisons. The Central Valley had the biggest year-over-year drop of 53.3 percent in November, followed by Southern California (49.0 percent), Central Coast (-46.3 percent), Far North (-40.1 percent), and the San Francisco Bay Area (-18.7 percent).

-- The median number of days it took to sell a California single-family home was nine days in November 2020, compared to 10 days in October 2020, 11 days in September 2020 and 25 days in November 2019. The nine-day November 2020 figure was the lowest ever recorded.

-- In San Diego County, the median number of days an existing, single-family home remained unsold on the market was seven days in November 2020, which was the same number in October 2020 and September 2020. The timeframe a year ago in November 2019 was 17 days. The November 2020 seven-day figure compares to eight days in August 2020, 10 days in July 2020, 12 days in June 2020, 11 days in May 2020, eight days in April 2020, 10 days in March 2020, 12 days in February 2020 and 23 days in January 2020.

-- The housing market in California’s mountain resort areas has generally outperformed the state during 2020’s first 11 months due to increased demand in second homes and vacation homes, as available supply continues to decline. In a comparison of home sales between November 2020 and November 2019, Mammoth Lakes saw a 400 percent increase, followed by South Lake Tahoe (81.4 percent), Big Bear (73.9 percent) and Lake Arrowhead (58.1 percent). Similarly, median home prices jumped in Big Bear by 40.8 percent from last year, followed by South Lake Tahoe (39.6 percent) and Lake Arrowhead (32.0 percent). In contrast, home prices declined by 2.5 percent Mammoth Lakes in November 2020, compared to 2019.

-- The 30-year, fixed-mortgage interest rate averaged 2.77 percent in November, down from 3.70 percent in November 2019, according to Freddie Mac. The five-year, adjustable mortgage interest rate was an average of 3.0 percent, compared to 3.41 percent in November 2019.

In other recent real estate and economic news, according to news reports:

-- The average rate for a 30-year, fixed-rate mortgage continued to plummet, dropping to 2.67 percent in the second week of December. It was the lowest rate since Freddie Mac began tracking the data in 1971. A year ago at this time, it averaged 3.73 percent.

-- Mortgage applications increased 1.1 percent for the week ending Dec. 11, according to the Mortgage Bankers Association’s week-over-week comparison report. Refinance applications also increased 1 percent during the same week and 105 percent in a year-over-year comparison.

-- CoreLogic said San Diego County median home price in November remained unchanged from October and September at $650,000, which is 9.3 percent higher than a year ago. It was the second consecutive time for no monthly price increase since May. The price represents all homes, including single-family, condos and townhomes.

-- A group of top real estate economists speaking at a forecast forum hosted by the National Association of Real Estate Editors recently predicted that home prices will continue to rise in 2021 fueled by low mortgage interest rates and lack of homes for sale.

-- Californians are pessimistic about their economic future with 73 percent of survey respondents in San Diego and Orange counties anticipating bad financial times during the next 12 months, according to a report released in early December by the Public Policy Institute of California. The survey of 2,325 Californians conducted after the November election showed the statewide average of pessimism at 68 percent.

-- Realtor.com is predicting prices for existing single-family homes will continue to climb in 2021, making affordability a continued problem. San Diego is projected for an 11.3 percent year-over-year increase in existing home sales and a 5.5 percent rise in home prices. Realtor.com also expects mortgage rates to climb from 3 percent at the beginning of 2021 to 3.4 percent by year’s end. Realtor.com admits there are numerous wildcards that could shake up the housing market, including what happens with Covid-19 vaccines or more government-imposed shutdowns.

-- Rental applications in San Diego County were lower by about 7 percent for the third quarter in a year-over-year comparison as many grown children moved back in with their parents, or doubled up in apartments to make their dollars go further, according to the data firm Rent Café. The report said in 18 of the 30 largest U.S. cities, including San Diego, more renters left than moved into rental properties. The firm also said apartment rents decreased in 2020 in the nation’s top 10 most expensive cities.

All PSAR members should be aware of the significant benefits available to homeowners as a result of the recent passage of Proposition 19 in the November general election.

Approved by California voters by a 51.1 percent to 48.9 percent margin, Prop. 19 is considered by many as a landmark property tax exemption law that is now part of the California constitution. Thanks to more than 8.5 million voters who marked their ballots “yes” for Prop. 19, homeowners will be able to take advantage of tax relief while providing much-needed revenue for schools, fire districts, cities and counties as they face budget shortfalls due to the harmful economic impact of Covid-19.

Prop. 19 was endorsed by C.A.R. and many others because it will spur housing economic recovery.

Prop. 19 limits property tax increases on primary residences for family transfers, homeowners over 55 years old, people with severe disabilities and victims of natural disasters or wildfires by removing unfair location and price restrictions.

Prop. 19 also limits property tax increases on family homes used as a primary residence by protecting the right of parents and grandparents to pass on their family home to their children and grandchildren for continued use as a primary residence.

Overall, Prop. 19 will open up tens of thousands of housing opportunities, making homes more readily available for first-time homeowners, families and Californians throughout the state.

There are two major benefits of Prop. 19, both dealing with what’s called “tax basis portability,” which means homeowners can enjoy an exemption from a reassessment of property taxes when they move to a new residence.

New Rules for Homeowners Over 55 Years of Age

With the passage of Prop. 19, a homeowner who is over 55 years of age, severely disabled or whose home has been substantially damaged by wildfire or natural disaster may transfer the taxable value of their primary residence to a replacement primary residence anywhere in the state within two years of the sale and up to three times, regardless of the value of the replacement primary residence.

According to the California Association of REALTORS® (C.A.R.), Prop.19 makes three significant changes to the portability of one’s tax basis from the sale of a principal residence to a replacement principal residence.

First, Prop. 19 allows a seller of a principal residence to transfer the tax basis of that principal residence to the purchase of a replacement principal residence anywhere in the State of California. Under prior law, the seller was limited to transfers either within the same county (under Proposition 60) or between a limited number of counties that specifically permitted such taxable value transfers (under Proposition 90).

Second, Prop. 19 allows the transfer of the tax basis of the sold principal residence to the replacement principal residence regardless of value with certain adjustments to the tax basis if the replacement principal property is of “greater value” than the sold principal residence. Under prior law, only transfers of “equal or lesser value” were eligible for the exemption.

Third, Prop.19 permits such transfers up to three times (but unlimited for those whose homes were destroyed or substantially damaged by fire). Prior law allowed such transfers only one time

There still remains some questions about the timing of tax benefits under Prop. 19 applying to transactions and sales before April 1, 2021.

According a statement from C.A.R., “Although we believe that the tax benefits under Proposition 19 apply to transactions where either the sale or purchase of a primary residence takes place before April 1, 2021, as long as the subsequent sale or purchase takes place within two years and on or after April 1, 2021, others have taken the position that both the sale and purchase must occur on or after April 1, 2021. C.A.R. will seek official clarification of this issue.”

New Rules on Intergenerational Family Transfers After Feb. 1, 2020

Prop. 19 also changes the rules on exemptions from reassessment for intergenerational transfers by limiting the exemption to the transfer of a primary residence to a child (or grandchild) only when the property continues to be used as a family home by the child (or grandchild). However, if the divergence between the taxable value and the actual value is too great, a partial increase in the new taxable value will be imposed.

Prop. 19 also includes provisions that would allow the transfer of a family farm to retain its taxable value.

These new rules apply to any purchase or transfer beginning Feb. 16, 2021.

Here are a few questions-and-answers relating to intergenerational family transfers and family farms:

Q: If I pass my principal residence on to my children or grandchildren, will the property be reassessed?

A: So long as the property continues to be used as a family home (primary residence), and the transferee claims the homeowner exemption, the property tax basis will remain the same, subject to some upward adjustments if the property value, at the time of transfer, is more than $1M over the original tax basis.

____________________________

Q: If the property is transferred to a child or grandchild and used as a family home, what will the new tax basis be if at the time of transfer the property value is less than $1M over the original tax basis?

A: The new tax basis will remain the same as the original tax basis. For example, if the original tax basis was, let's say, $500,000, and at the time of transfer the property is valued at $1.2 M, then the tax basis will remain at $500,000. This is because $1.2M is not more than $1M over the original taxable basis.

____________________________

Q: How are family farms included in Proposition 19?

A: Family farms have the same exemptions as family homes (principal residences). “Family Farm” means any real property under cultivation or which is being used for pasture, or grazing, or that is used to produce any agricultural commodity. It does not require the transferee to live in the property as a principal residence.

PSAR members who have additional questions about the benefits of Prop. 19 are encouraged to contact either C.A.R. or the office of San Diego County Assessor-Recorder-County Clerk (ARCC) Ernest J. Dronenburg, Jr. The ARCC office oversees assessing the value of real estate and personal property (property taxes constitute the largest share of revenue for the county). The office also involves registering business names and issuing marriage licenses, birth and death certificates. 

For assistance from the Assessor’s office please contact Taxpayer Advocate Jordan Marks. Jordan is a PSAR member and welcomes calls and emails from PSAR members. He can be reached at Jordan.Marks@sdcounty.ca.gov. For emergency assistance you can reach Jordan on his cell phone is (619) 372-0226.The website for the ARCC office is www.SDARCC.com.

Win an iPad Pro & avoid additional fees by simply paying 2021 REALTOR^® dues on time by December 31st, 2020**.

• All current active members on the PSAR monthly payment plan for 2021 qualify!
• Those on autopay for annual dues will also be entered to win!

Watch the drawing on the Thursday, January 14th Rally and Ride Pitch Session at 9:00am. We will also be streaming on PSAR's Facebook Group!  Members do not need to be present to win.

To watch on Facebook, join the new NEW Private PSAR Facebook Group in advance.

Sponsored by:

*Note:

• REALTOR^® Dues are not MLS fees
• MLS fees and key fees are billed separately and are not considered for this promotion

**Payments can be made on the PSAR Portal, or by calling one of our three offices - South: 619-421-7811, Central: 858-286-6080, East: 619-579-0333.

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