2018 California Real Estate Forecast
California’s five-year run of rising home prices is expected to last another three to five years, with median house prices on track to beat the record highs set during the housing bubble according to Redfin.
The California Association of Realtors forecast home prices will increase an additional 4.2 percent in 2018, rising to $561,020. If the forecast proves accurate, that existing single-family home price will exceed the record high of $560,270 set in 2007. Prices, however, will remain well below pre-recession records when taking inflation into account. Southern California home prices are expected to rise at roughly the same pace in 2018 and to match the statewide median.
Single-family home sales also are projected to increase in California next year, but at a much more modest pace, the Realtor forecast said. CAR projected 426,200 houses will change hands, up 1 percent from this year’s level.
The big mystery in the housing market, however, is why the pace of sales and price growth isn’t higher given that jobs and incomes have been rising. The answer lies in twin ills that have plagued the housing market for the past four years: Too few homes for sale and too few buyers able to afford those that are on the market at today’s prices.
If you are looking to buy or sell this year, contact Arthur Kalayjian, Santa Barbara’s luxury estate Realtor to discuss your options.