House prices fell last month in Los Angeles, Orange and San Diego counties, and in half of all counties included in the California Association of Realtors' latest housing report.
It's the first year-over-year price drop for Los Angeles and San Diego counties in seven years and the third in Orange County in the past four months.
House sales, meanwhile, were down in all major regions in the state — falling 12% year over year in the Los Angeles metro area, CAR reported.
March's price and sales declines occurred even though the economy remains strong and despite recent drops in mortgage rates, said Jordan Levine, a CAR senior economist.
Low mortgage rates may yet reignite demand during this year's spring home buying season, when sales typically are at their highest, he said. "It's tough out there," Levine said, "but there's no reason (for sellers or their agents) to panic."
He attributed last month's price weakness to three key factors: House hunters remain nervous about buying at what many see as a market peak; many home shoppers still can't afford to buy after nearly seven years of steady price gains, and listings in the state have jumped 14%.
"As a seller, you have a lot more competition for your unit than a year ago or even two years ago," Levine said. With more homes to choose from, buyers are taking their time.
One sign of wariness emerged from CAR's monthly survey of more than 400 home buyers. Just 22% said during the first week in April now is a good time to buy a home, down from 27% six months earlier, Levine said.
So how big were the drops? CAR single-family home figures for March show:
● The median price of an existing Los Angeles County house, or price at the midpoint of all sales, was $525,520, down 0.7% from March 2018 levels. L.A. County single-family home sales were down 13% year over year.
● Orange County's median was $809,500, down 1.8%, while O.C. sales were off 12.5% from year-ago levels.
● San Diego County's median was $623,800, down 0.3%, while sales were down 3.9%.
● Riverside County's median was $412,000 in March. That's up 3.5% year over year, although sales were 9.3% below March 2018 levels.
● San Bernardino County's median was $309,950, up 10.7%. Sales there fell 12.2%
● House prices fell 4.1 percent in the San Francisco Bay area, with price drops in every county but Napa.
● Price drops occurred in 25 of the 50 counties included in CAR's report, with a 20.5% drop in Santa Barbara County and a 10.6% decline in Santa Clara County, home to Silicon Valley.
By comparison, California's statewide median was $565,880, up a mere 0.2% from a year ago. Statewide, sales were down 6.3%.
California's sales picture actually showed signs of improvement, considering that transactions were down by double digits in four of the previous five months, CAR figures show.
CAR Chief Economist Leslie Appleton-Young noted the state's median house prices have been softening since hitting an all-time high last June. But she held out hope for a rebound in sales later this year.
"The flattening home prices, coupled with low mortgage rates, bode well for housing affordability and may bring more buyers who may have given up back to the market," Appleton-Young said.
