The California Association of REALTORS® forecast for 2009 expects sales to rise 12.5 percent and the median home price to drop 6 percent next year. The "2009 California Housing Market Forecast" was presented by the state trade association during the California Realtor Expo 2008, held Oct. 14-16 at the Long Beach Convention Center in Long Beach, Calif. The trade show is the largest state real estate trade show, attracting more than 10,000 attendees.
"The current uncertainty about the financial system and economy is likely to persist over the next several weeks, and could extend into next year," said C.A.R. President William E. Brown. "We expect that the economy will be at its weakest period over the next three quarters through the second quarter of 2009, with recessionary economic conditions throughout that time period, before we begin to see a turnaround in the second half of next year
"A great deal depends on the state of the financial system in general and the real estate finance situation in particular, as well as the flow of distressed sales through the market. We expect sales of distressed properties to peak in early 2009. Looking ahead, home prices and favorable interest rates in 2009 will contribute to gains in affordability," Brown said.
Sales in 2009 are projected to increase 12.5 percent to 445,000 units, compared with a projected 395,600 units in 2008.
"Sales in 2008 will be ahead of last year by 12 percent, with a further increase of 12.5 percent expected in 2009," said C.A.R. Vice President and Chief Economist Leslie Appleton-Young. "However, the next couple of quarters in late 2008 and early 2009 will be marked by seasonal decreases in activity, with a pickup expected by the second quarter of next year."
C.A.R. is projecting a median price of $381,000 this year, and a 6 percent decline in 2009. Appleton-Young said, "For all of 2008, the median price is expected to fall by 31.7 percent from $558,100 to $381,000. Next year, we're projecting that the median price will show a 6 percent decline to $358,000."
Silicon Valley Association of REALTORS® President Leannah Hunt, who attended the convention along with other officials from the local trade association, continues to maintain a positive outlook about the housing market in the Silicon Valley region.
"We need to move through the current financial crisis. It's critical that the flow of credit is restored so qualified buyers are able to take advantage of improved affordability and purchase homes," Hunt said.
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.
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