California Real Estate Market
January was an astonishing month for the California housing market as median house prices fell only slightly while sales slumped by 26% to 32% across most regions.
Homebuyers may have been scared off by rising unemployment which is above 9%. Only Hawaii and Nevada have higher unemployment. And mortgage payments were higher again in January and borrowers wonder if rates might rise despite claims to the contrary.
And year to date, sales and prices are up a whopping 22% over last year’s numbers. It was the single-detached market that kept its hot pace in comparison, yet house sales still declined 4.9% from December.
The story of the housing market reflects huge demand for more roomier accommodations and a flight from high density housing. Prices of condos continued to decline and rent prices too are falling from the levels established for a decade.
Home sales should never be this strong during the winter months, but it’s been nothing but out of the ordinary in this past year. Californians are struggling through a terrible pandemic wrestling with debt, fires, Covid 19, work from home, retail shutdowns, back rent and mortgage problems, stubborn unemployment and the effects of Techsodus.
Only the Manhattan real estate market has been hit harder.
The resurgance in California real estate last month was driven more by the Bay Area market which saw almost 32% gains vs last year’s numbers.
The California Realtors Association’s newly released reports reveals:
Existing, single-family home sales fell to 484,730 in January, yet are still up 22.5% from January 2020. And the median price of a house reclined 2.5% from December to $699,890, yet remains 21.7% above the price of 12 months ago.
Sales Remain Brisk Despite Supply Problems
January’s home sales remained at the highest levels since 2005 and we haven’t yet hit the spring house-buying season which should be a strong one. With such low inventory and stalled new construction numbers, we can confidently forecast much higher home prices. California unemployment should fall as the pandemic eases and as stimulus funds are distributed.
Sales Remain 20% Above Last January
California Housing Market Report for January 2021
Home Price Growth Strong in Single Family Segment
Mortgage Payments Rising. Screenshot courtesy of CAR
California Association of Realtors in its June housing sales report said Realtors were feeling optimistic but a lack of supply is impeding the California real estate market recovery.
In the greater Los Angeles region, single-detached homes rose $4,750 in January to a new price of $630,000. That is $91,500 more than 12 months ago.
In the San Francisco Bay Area, house prices fell $33,000 from December to a new median price of $1,025,000. This still up $42,000 from 12 months ago.
In San Diego, single-detached homes stayed the same at $730,000 yet that price is still up $70,000 over the last 12 months.
Best Performing Cities in California
Where to buy your next home in the Golden State? Homesnacks conducted an estimate based on about 5,000 population and growing, rising home prices, and within 20% of state price average. Here’s their best picks:
- Dos Palos
- San Pablo
- Los Banos
- Lake Elsinore
Realtors will need better strategies on how to get people to sell their homes.
China trade tariffs and US business repatriation could stimulate California’s economy and encourage more home building. Many believe America First may not be good for California, New York, or Florida or other states that depend on International trade. And many multinationals are headquartered in California and New York City.
Now that we’re past 2 years, the pain will be much less and a US first business agenda will bolster the stock markets more and power up employment in California.
Zillow expects California home prices to rise only $2k from is $569,000 currently in March 2021. The averagehome rental in California is up to $2657 per month. Mortgage delinquency rate is very low at .6%.
California Home Price Growth 2017 to 2020 by County
|California County||Median Price June 2020||Median Price May 2020||Median Price 2017||3 year change|
|Contra Costa County||$750,500||$690,000.00||$570,750.00||24.0%|
|Los Angeles County||$610,260||$546,930.00||$581,000.00||4.8%|
|San Diego County||$678,000||$655,000.00||$550,000.00||18.9%|
|San Francisco County||$1,805,000||$1,627,500.00||$1,325,000.00||26.6%|
|San Joaquin County||$415,000||$415,000.00||$386,500.00||6.9%|
|San Luis Obispo County||$645,500||$632,500.00||$599,000.00||7.2%|
|San Mateo County||$1,735,000||$1,650,000.00||$1,250,000.00||28.0%|
|Santa Barbara County||$671,750||$637,500.00||$545,000.00||18.9%|
|Santa Clara County||$1,382,000||$1,365,000.00||$1,000,000.00||27.6%|
|Santa Cruz County||$905,000||$850,000.00||$727,000.00||19.7%|
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