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California Housing Market Expected to Rebound in 2024
Upbeat Forecast Despite Ongoing Challenges
The California housing market is showing signs of recovery despite ongoing challenges brought on by rising mortgage rates and economic uncertainty. According to the CALIFORNIA ASSOCIATION OF REALTORS (CAR), the state's housing market is expected to rebound in 2024.
Key Indicators Point to Recovery
- Home prices in California were up 69% year-over-year in July.
- The number of homes sold rose 117% over the same period.
- The average home value in California is $784,989, up 60% over the past year.
These positive indicators suggest that the California housing market is starting to recover from the slowdown experienced in 2022. As mortgage rates gradually decline, more buyers are expected to enter the market.
Factors Contributing to the Rebound
- Ebbing Mortgage Rates: Mortgage rates are expected to ease in 2024, making homeownership more affordable.
- Limited Housing Supply: California's housing supply remains tight, keeping prices high and supporting the market.
- Strong Job Market: California's strong job market is fueling demand for housing.
Market Variation Across the State
While the overall outlook for California's housing market is positive, market conditions vary across different areas of the state. Some metro areas are in the early stages of recovery, while others have already experienced significant price appreciation.
However, CAR notes that even in areas where prices have increased substantially, the market may still continue to appreciate due to the limited housing supply and strong demand.
Long-Term Outlook
The long-term outlook for California's housing market remains optimistic. The state's strong economy, limited housing supply, and growing population are expected to continue supporting price growth in the years to come.