California's housing market will continue to recover in 2013. Home sales are expected to increase for the third consecutive year and the median price to rise for the second straight year, according to the California Association of REALTORS® (C.A.R.) "2013 California Housing Market Forecast," released this week.
The C.A.R. forecast sees sales gaining 1.3 percent next year, reaching 530,000 units. That number is up from the projected 2012 sales figure of 523,300 homes sold. Home sales in 2012 are projected to be up 5.1 percent from the 497,900 existing, single-family homes sold in 2011.
"The market has improved moderately over the past year, and we expect that to continue into 2013," said C.A.R. president LeFrancis Arnold. "Sales would be even higher if inventory were less constrained in REO-dominated markets, particularly in the Central Valley and Inland Empire, where there is an extreme shortage of available homes. Sales will be stronger in higher-priced areas, where there are more equity properties and a somewhat greater availability of homes for sale."
C.A.R.'s forecast projects a growth in the U.S. Gross Domestic Product of 2.3 percent in 2013, after a gain of 2 percent in 2012. With a job growth of 1.6 percent, the state's unemployment rate should decrease to 9.9 percent in 2013 from 11.7 percent in 2011 and 10.7 percent in 2012.
The average for 30-year fixed mortgage interest rates will edge up to 4 percent after six consecutive years of declines, but will still remain historically low, according to the report.
The statewide median home price is forecast to increase a moderate 5.7 percent to $335,000 in 2013. Following a decrease in 2011, the California median home price will climb a projected 10.9 percent in 2012 to $317,000.
C.A.R. vice president and chief economist Leslie Appleton-Young presented C.A.R.'s forecast on Wednesday afternoon during the California REALTOR® EXPO 2012, running from Oct. 2-4 at the Anaheim Convention Center in Anaheim, Calif. "The housing market momentum which began earlier this year will continue into 2013," said Appleton-Young. "Pent-up demand from first-time buyers will compete with investors and all-cash offers on lower-priced properties, while multiple offers and aggressive bidding will continue to be the norm in mid- to upper-price range homes."
The California REALTOR® EXPO 2012 is the largest state real estate trade show in the nation. Suzanne Yost, president of the Silicon Valley Association of REALTORS®, and the leadership of the local trade association were among nearly 6,500 attendees attending the trade show and meetings in Anaheim this week.
"We are greatly encouraged by C.A.R.'s forecast. Our members in Silicon Valley have been dealing with multiple offers for the past months. As home prices rise, we believe sellers will be encouraged to jump in the market and that would ease the lack of inventory that we currently face," said Yost.
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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