The coronavirus lockdown walloped California house sales in May, resulting in a 41.4% drop in transactions from the previous year, the California Association of Realtors reported.
It was the biggest year-over-year decrease since November 2007.
Median house prices, meanwhile, also fell from year-ago levels, the first such drop in eight years.
The trend reflects home deals reached during the height of the lockdown in March and April when open houses shifted online and buyers and sellers pulled out of the market. However, market data reflecting escrows opened more recently shows a rebound is underway.
"The sharp sales drop in May was the steepest we've seen in some time, but there are encouraging signs that show the market is recovering and should continue to improve over the next few months," said CAR President Jeanne Radsick Bakersfield.
The Los Angeles metro area posted a 46% sales drop last month, the biggest annual percentage decline for the region since October 2007. But house prices were up from year-ago levels in every Southern California county but Orange, where the median — or price at the midpoint of all sales — dipped 1.2%.
The numbers reflect closed sales for existing single-family homes, which represent more than two-thirds of all residential transactions.
CAR reported 238,740 houses would sell during a full year at May's sales pace. It was the slowest sales pace statewide since the start of the Great Recession 13 years ago. The last full year with sales as slow as May was 1982, a recession year when interest rates averaged 16% (compared with 3.2% as of last week). May sales also were down 13.9% from April.
All but one of the 51 California counties tracked by CAR experienced a year-over-year sales drop last month, the report said, and all regions of the state saw sales decline by at least 35%.
"As we predicted, May home sales took the full impact of the coronavirus pandemic as much of the state remained in lockdown during the past few months and caused three straight months of double-digit sales declines," CAR Chief Economist Leslie Appleton-Young said in a statement.
Meanwhile, the statewide median house price fell for the first time since February 2012, dropping 3.7% to $588,070.
Southern California house prices were more stable. In Los Angeles County, the median house price rose 1.4% to $546,930. Riverside County had a gain of 3.4%, rising to $434,480; and San Bernardino County saw prices rise 1.6% to $320,000.
Prices are weaker in Orange County, the region's most expensive housing market. The median for a single-family home hit $834,550 last month, down from year-before levels for the fourth time in the past 1.5 years.
Numbers show transactions are rebounding somewhat. New escrows in Los Angeles, Orange, Riverside and San Bernardino counties were up 48% as of June 11 from the month before and were up 2% from the year before, according to Reports On Housing.
Statewide, escrows were down 6% as of June 6, according to Zillow — indicating closed sales in June and July likely will see a much smaller drop than May.
The buyer "perception gap" also shows signs of improving, based on a CAR agent survey. Agents said 77% of buyers expected price drops in late May compared with 90% a month earlier. Twenty-nine percent said sellers were cutting their prices in late May compared with 33% a month earlier.
"While we expect sales activity to remain below pre-COVID-19 levels," Appleton-Young said, "closed sales should improve markedly as the phased reopening of the economy continues and consumers feel more confident returning to the market."
