Million-dollar home sales in the Golden State slipped to their lowest level in five years, according to real estate information provider DataQuick.
A total of 24,436 homes sold for a million dollars or more in California last year, a 42.5 percent decline from the 42,506 sold in 2007.
It’s the lowest total since 2003 when 20,595 million-dollar homes were sold, and less than half the 50,010 sold in 2006 when real estate was booming.
“Discretionary spending in the housing market has pretty much been on hold the past fifteen months,” said John Walsh, DataQuick president, in a release.
“The core of last year’s distress was clearly in affordable areas that had a lot of turnover in 2005 and 2006. That distress could migrate up the price ladder if this recession proves nasty for high-income households.”
A big problem was been financing jumbo loans; the number of home purchase mortgages below the old conforming limit of $417,000 increased by 21 percent last year, while the number above decreased a whopping 51 percent.
“A lot of home sales in the upper half of the market have been on hold for months, waiting for financing,” Walsh added.
That led to nearly a quarter of buyers paying with cash, up from 14 percent in 2007, with those who chose to finance coming in with a median 30 percent payment.
Total California home sales at all price levels increased 2.5 percent last year to 393,703 units, up from 383,748 in 2007.
Of the sub-one million dollar home sales, at least 2,052 previously sold for more than $1 million.
Interestingly, the 608 sales for more than $5 million last year was a record high, up 7.6 percent from 565 similar sales in 2007.
Roughly three percent of the 8.51 million homes in California are valued at more than $1 million by county assessor offices.