Local home market holds up during shift to off-peak season | News

The report by appraiser Gary Crabtree points to a continuing imbalance in local housing — and strength in the new construction market — as Bakersfield homebuying transitioned to the off-peak season.

Bakersfield’s median sales price last month, defined as the point at which half the homes sold for more that month and half went for less, reached $340,000, or nine-tenths of a percent less than September.

Statewide, October’s rate of decline was a little sharper at 1.3 percent. On top of that, while California’s sales volume decreased, Bakersfield’s increased slightly.

Crabtree noted the difference between the state and local market performance, interpreting Bakersfield’s as exhibiting “good strength.”

“In my opinion, the basic driver (in) this market continues to be its affordability,” he summarized in his October report, adding, “The Bakersfield median price is 57 percent below the state’s median price, and the latest data indicates the Bakersfield market has the third-lowest affordability in the state.”

Low supply has been a driving factor in Bakersfield for years, and it got worse in October as listings declined almost 14 percent to 427, which was more than 28 percent lower than a year before.

Demand as measured in total sales of existing homes ticked up a little less than a half-percent last month to 571, or about 13 percent less than a year before, according to Crabtree’s report.

Notably, the sales volume of newly built homes in Bakersfield dropped more than 12 percent in October. But at the same time, the median price of a home of new construction in the city rose more than 10 percent to reach $420,000. That’s basically a third higher than the median a year earlier.

Crabtree commented on the trend, noting the National Association of Home Builders recently reported construction costs are up lately. He added that the last home sold locally by a builder of entry-level houses took place in June, suggesting buyers may have had to move on to higher-priced homes.

Jordan Levine, vice president and chief economist of the California Association of Realtors, which released October’s state figures, noted in a news 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 outperforming the pre-pandemic levels observed in 2017, 2018 and 2019,” Levine stated. “Slower sales activity suggests that the market is returning to its typical seasonal pattern and further market normalization can be expected in the upcoming months….