- For the first nine months of 2013, California sales of existing single-family detached homes were down 3.2 percent when compared to the same period of last year, mostly because of the hike in interest rates in recent months. In 2012 California saw 439,420 units sold, we expect 2013 to finish at 430,270, and 2014 improving to 444,040 units.
- The year 2013 is a year when the California housing market is transitioning from “investor sales” to “primary home sales”. Next year will be a more “normal” year and the economy will presumably grow at a faster pace, which will provide support to the housing market.
- With inventory levels remaining lean through the rest of 2013, the California median price is projected to increase 28.0 percent from 2012 to 2013. More homes in the upper price segments will be sold in 2013 when compared to 2012. Because of the change in the mix of sales from 2012, the statewide median price is expected to increase significantly on a year-to-year basis. The increase in the median price at the state level, however, appears to be slowing down in recent months. The median price for California existing single family homes is projected to increase an estimated six percent to $432,800 in 2014.
- Investors are paring their purchases of distressed homes as their profit margin narrows. As investors take a step back, inventory will likely increase slightly in the upcoming year. Meanwhile, the increase in home prices will also encourage more homeowners to put their houses up for sale. The housing supply will grow and should gradually climb back from under three months in 2013 to about four months in 2014.
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