2017 California Housing Market Forecast

Home sales are leveling off. Prices are rising more slowly. And even mortgage rates near all-time lows.
According to the California Association of Realtors 2017 California housing market forecast, the sunshine state will post modest gains next year amid tight supplies and the lowest housing affordability in six years.
“Next year, California’s housing market will be driven by tight housing supplies and the lowest housing affordability in six years,” said C.A.R. President Pat “Ziggy” Zicarelli. “The market will experience regional differences, with more affordable areas, such as the Inland Empire and Central Valley, outperforming the urban coastal centers, where high home prices and a limited availability of homes on the market will hamper sales. As a result, the Southern California and Central Valley regions will see moderate sales increases, while the San Francisco Bay Area will experience a decline as home buyers migrate to peripheral cities with more affordable options.”
Eyes on Santa Barbara and Montecito Real Estate Prices
Here in Santa Barbara, my November Newsletter shows that seller’s expectations outweighed buyer’s willingness to accept a reset in the local real estate market. I expect this trend to continue short term as we have already started to see some properties selling at discounted prices from the original list prices and December generally marks a time where sellers are more willing to let go at a lower price and start fresh in the new year.
Continuing resistance by buyers is the ongoing theme when it comes to Montecito real estate prices. In November, prices continued their decline in both median and average sales: down 5% and 15% respectively. This data considers an increase in the number of days a property is on the market, and total number of properties for sale, but is slightly tempered by an increase in properties sold (no doubt due to slightly lower prices), which rose 8%. The continuing “real” barometer is the sold price per sq. ft., which declined 3% for November despite a 26% increase in the asking price per sq. ft.
Santa Barbara saw a slightly different picture in November, which is representative of the general marketplace currently, where the luxury end is lagging but the more affordable level housing is doing quite well. Properties may be taking longer to sell, but both property sales are up 16% and available inventory is down 9%, which will help support prices due to tight supply levels. There still appears to be sufficient buyer demand moving forward.
Tune in to my year-end report for a more detailed analysis of the 2017 California housing market forecast. But you don’t have to wait until the forecast to move here. I can help you find the real estate that you are looking for in Montecito, Hope Ranch or any of Santa Barbara’s upscale communities. Call me at 805.886.9378 or email me at Cristal@montecito-estate.com and we’ll begin your real estate search. I am also here to help homeowners sell their property using my tried and true marketing strategy. I look forward to helping you find your dream home or selling your property in this beautiful part of the world!