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As the new year begins, Realtors are reviewing the market in 2004 as a benchmark for what's to come since the past year is set to become one for the record books. Although the final data is not complete for December, some of the highlights for 2004 as reported by the California Association of Realtors include:
* A record year for home sales, which are projected to increase 3 percent over last year's record sales figure of 601,800 existing detached homes.
* A record year for home prices. The median price of a single-family home in California crossed the $400,000 threshold late in 2003, and will finish the year with an annual median in excess of $450,000, 22 percent higher than the 2003 annual median of $372,700.
* The percent increase in the median price of a single-family home increased by double digits for the third consecutive year in 2004.
* The Unsold Inventory Index reached a historic monthly low of 1.5 months in April 2004.
* Time on the market--the median number of days it takes to sell a single-family home--was the third lowest on record at a projected annual average of 29 days, surpassed only by 2003 at 27 days and 2002's all-time low of 26 days.
* The Housing Affordability Index fell to 19 percent in May, the first time the index has hit the teens since December 1989. Since that time, rapid price appreciation and marginally lower interest rates have generally offset each other, keeping the index in the 18- to 19-percent range throughout the summer and fall of 2004.
* The affordability gap between California and the rest of the nation reached an all-time annual high of 36 percent in 2004. Nationally, affordability was at 56 percent in 2004, four points below its record high.
* New home building eclipsed the 200,000 mark in 2004 for the first time in more than a decade, with an expected total of 206,000 permits for the year. The last time the state exceeded 200,000 permits was in 1989, when 238,000 permits were issued. Yet this year's permit total fell short of household growth, which is estimated at between 220,000 and 250,000 households in 2004.
* First-time homebuyers as a share of the total market fell to an all-time low of 26 percent in 2004, based on the state association's annual Housing Market Survey.
* The Boomer Generation exerted a tremendous influence on the California housing market in 2004, accounting for three out of four transactions.
* Internet use by homebuyers and sellers continued to climb in 2004. Based on the Internet Versus Traditional Buyers Survey, 56 percent of all buyers used the Internet in a substantial way as a part of their homebuying process, surpassing the 50 percent mark for the first time.
Forty-seven percent of homesellers indicated that they had used the Internet in the homeselling-process, a dramatic increase from 12 percent in 2003, according to C.A.R.'s Survey of California Home Sellers.
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