California home sales and median price are predicated to rise slightly in 2012 according to California Association of Realtors’ ® (C.A.R.) “2012 California Housing Market Forecast”. The forecast for next year is said to see a 1 percent increase to 496,200 units, following essentially flat sales of 491,100 homes this year compared to the 491,500 homes sold in 2010.
The C.A.R. says the increase is a minor one because of the continuation of the tepid economic recovery, uncertainty about the future, and funding challenges for residential mortgages are expected to keep the market moving sideways, with little foreseeable momentum in either direction.
California’s median home price will rise 1.7 percent to $296,000 in 2012, according to the forecast. Following a double-digit increase in the median price in 2010, the median home price will decrease a projected 4 percent in 2011 to $291,000, according to C.A.R.
“Despite the run of unforeseen global events in the first half of this year that slowed the overall economy, 2011 home sales are projected to essentially remain unchanged from last year,” C.A.R. President Beth L. Peerce said in a statement.
“Looking ahead, the fundamentals of the housing market – such as low mortgage rates, high housing affordability, and favorable home prices – are expected to continue, but at this point, a strong housing recovery will depend on consumer confidence, job creation, and the availability and cost of home loans.”
Some are pleased to see any kind of increase, be it small, than not at all.
Although now is the best time to buy a house than ever because of prices, interest rates, and supply Americans just don’t have the confidence to buy. If they do and have the money saved up for a down payment they decide to stand back and “watch” the market.
“Discretionary sellers will play a larger role in next year’s housing market,” said Peerce. “Those who held off selling in 2011 may list their homes in 2012, thereby improving the mix of homes for sale compared with the last few years. Additionally, distressed sales will remain an important segment of the overall market as lenders continue to work through the foreclosure process.”
C.A.R. 2012 FORECAST FACT SHEET
| 2005 | 2006 | 2007 | 2008 | 2009 | 2010 | 2011f | 2012f | |
| Existing Single-family Home Resales (000s) | 625 | 477.5 | 346.9 | 441.8 | 546.9 | 491.5 | 491.1 | 496.2 |
| % Change | 0.03% | -23.60% | -27.30% | 27.30% | 23.80% | -10.10% | -0.10% | 1 |
| Median Price ($000s) | $522.70 | $556.40 | $560.30 | $348.50 | $275.00 | $303.10 | $291.00 | $296.00 |
| % Change | 16.00% | 6.50% | 0.70% | -37.80% | -21.10% | 10.20% | -4.00% | 1.7 |
| 30-Yr FRM | 5.90% | 6.40% | 6.30% | 6.00% | 5.10% | 4.70% | 4.50% | 4.7 |
| 1-Yr ARM | 4.50% | 5.50% | 5.60% | 5.20% | 4.70% | 3.50% | 3.00% | 3.1 |
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