As 2011 comes to an end, real estate industry officials are hopeful signs of healing in the economy will positively impact the housing market. These positive indicators include recent announcements that the state's housing production increased for a fourth consecutive month in November; California home sales increased both on a monthly and annual basis in November, marking the fifth consecutive month of year-to-year sales increases; and the December Consumer Confidence Index rose to the highest level since April, signifying Americans' confidence in the economy is on the upswing.
"The rise in housing production and home sales during a traditionally slow month is heartening," said Gene Lentz, president of the Silicon Valley Association of REALTORS®. "That consumers are becoming more optimistic is a good sign, too. We are hoping all these positive indicators will peak buyer interest as we approach a new year."
Although the state is still on track to end the year with the third-lowest housing starts tally on record, data from the Construction Industry Research Board (CIRB) shows permits for 4,011 housing units were pulled in November, up 21 percent from the same month a year ago and up 52 percent from October. Permits for single-family homes totaled 1,486, up 4 percent from November 2010, but down 1 percent from the previous month, while multifamily permits totaled 2,525, up 33 percent from a year ago and up 123 percent from October. CIRB projects a total of 46,000 residential permits will be pulled during the year, which would make 2011 the third-lowest year for homebuilding on record, since CIRB began tracking permits in 1954. The record-low 36,421 permit total was posted in 2009, while the second-lowest total of 44,762 permits issued was posted in 2010.
Like Lentz, California Building Industry Association president and CEO Mike Winn maintains a positive outlook. "These past few years of record-low housing production have taken a massive toll on our state's employment rate and economy," said Winn. "Hopefully this trend of increased production over the past four months is a sign of better times to come in 2012."
The California Association of REALTORS® recently reported November closed escrow sales of existing, single-family detached homes in California were up 2.1 percent from October and up 2.3 percent from units sold during the same period a year ago.
"Despite the challenges the housing market has faced, sales are maintaining a pace that is just shy of normal levels, enabling both distressed and non-distressed properties to move and providing a tremendous opportunity for those who are looking to buy a home," said C.A.R. president LeFrancis Arnold.
Additionally, the Conference Board said Tuesday that its Consumer Confidence Index rose almost 10 points to 64.5, up from 55.2 in November. The rise in December followed another big increase in November, when the index rose nearly 15 points from the previous month.
"Consumers took advantage of better discounts during the holiday season. Housing today is at a big discount, especially in the state of California," said Lentz. "Mortgage interest rates are still low, affordability has never been better, and although economic recovery is at a slower pace than we would want it to be, we continue to have a positive outlook for 2012."
The Silicon Valley Association of REALTORS® (SILVAR) is a professional trade organization representing over 4,000 REALTORS® and Affiliate members engaged in the real estate business on the Peninsula and in the South Bay. SILVAR promotes the highest ethical standards of real estate practice, serves as an advocate for homeownership and homeowners, and represents the interests of property owners in Silicon Valley.
The term "REALTOR®" is a registered collective membership mark which identifies a real estate professional who is a member of the National Association of REALTORS® and who subscribes to its strict Code of Ethics.
Variations of this article have appeared in local area newspapers.
For further information, please contact Rose Meily at SILVAR Public Affairs, email , or phone (408) 200-0109.