The CALIFORNIA ASSOCIATION OF REALTORS[R] (C.A.R.) projected a 14 percent decline in single-family home sales this year, and forecast a 1.8 percent increase in the median price of a home. C.A.R. Executive Vice President Joel Singer delivered the Association’s 2007 Midyear Housing Market Forecast as part of the California REALTOR[R] Showcase and C.A.R.’s Legislative Day activities this week in Sacramento.
Sales are expected to fall to 410,500 units in 2007, a 14 percent decline from the 477,460 pace recorded in 2006, according to the forecast. The median price of a home will reach $566,500 this year, a 1.8 percent increase from the $556,640 median for 2006.
“Sales have declined in all areas of the state, but higher-end markets have experienced somewhat smaller declines,” said C.A.R. Vice President and Chief Economist Leslie Appleton-Young. “Sales are weakest in areas that had a lot of new home building in recent years or those areas that had been popular for second home purchases.
“Prices tend to be softer in those areas as well,” she said. “This pattern is likely to continue throughout the rest of the year, particularly in areas that were popular among first-time home buyers, which experienced the greatest run-up in prices. Similarly, higher-end markets have seen greater price stability, with the median price of a home declining slightly, if at all. The sales mix, with slower sales in the entry and lower-end of the market and relatively stronger sales in the high end, has helped stabilize the median price.”
According to the C.A.R. forecast, the Central Valley region has experienced a greater decline in sales compared with the state as a whole, and a succession of year-to-year declines in the median price. This trend is likely to continue, due in part to excess inventory of new homes for sale.
The San Francisco Bay Area and moderately priced to higher-priced areas of Southern California have seen a somewhat better sales picture, with small or nonexistent median price declines. These areas should continue to fare better than lower-priced inland markets in the San Bernardino and Riverside areas, according to Appleton-Young. Sales in those areas remain significantly below the record levels of the peak years, she said.
Advice for Buyers & Sellers
Buyers, the summer months continue to show increased inventory levels. I continue to see sellers who have priced their properties below market value, or are ready to come down because they really need to sell. The best way to find motivated sellers is to initiate negotiations with your offer. Homes priced competitively will still go quickly, so use the Home Finder on my website. If you have friends who are thinking about buying, I suggest that they stay on top of the market by viewing all properties for sale in their neighborhood at www.SanDiegobythesea.com
Sellers, it pays to present your property in tip-top condition. Competition continues to grow with the rise of summer inventory and continues to demand professional marketing that advertises your property aggressively. If you know anyone who is thinking about selling, please let me know how I may be of assistance so their property stands out from all the rest.
Sellers, it pays to present your property in tip-top condition. Competition continues to grow with the rise of summer inventory and continues to demand professional marketing that advertises your property aggressively. If you know anyone who is thinking about selling, please let me know how I may be of assistance so their property stands out from all the rest.
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