SILICON VALLEY ASSOCIATION OF REALTORS – California’s housing market will continue to recover in 2013 with gains in both home sales and prices.
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 (CAR) “2013 California Housing Market Forecast,” released last week.
Suzanne Yost, president of the Silicon ValleyAssociation of Realtors (SILVAR) (CA) said, “We are greatly encouraged by CAR’s forecast.”
Yost and the leadership of the local trade association were among nearly 6,500 people attending the recent trade show and meetings.
The CAR forecast sees home 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.
CAR’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.
CAR vice president and chief economist Leslie Appleton-Young presented CAR’s forecast last Wednesday during the California Realtor EXPO 2012 in Anaheim.
She said, “The housing market momentum which began earlier this year will continue into 2013. 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.”
Yost added, “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.”