The California Association of Realtors published their 2016 Forecast last week, and it’s a whopper – 131 pages (scroll down to bottom of page for full report).
Here are the highlights:
San Diego County prices and sales are positive, which is a healthy sign. The median sales price was up 9.1%, and the number of sales increased 11.5%.
I’m going to take the under for 2016, and guess that we’ll have fewer SD sales next year, mostly because on the remaining graphs below:
Seems like prime coastal areas have gotten way ahead of county medians.
I’m going to call flat prices for 2016 at the coast, given flattening stock markets and QCOM and biotech troubles.
Rich people want to park their money outside of the stock market. I call continued upside on the coast. The feeling is the stock market has done whatever it will do at least through election year, and global markets may even push it down. A coastal property @3% loan interest (if they don’t pay cash), is attractive. And rental prices are going up up up! I’ve been saying this since I started following Jim in 2007: the rich get richer, no matter what’s happening worldwide. My little kids will never live on the coast when they grow up. The coast will be all 2nd houses and VRBOs by then.
I’m heading to Santa Barbara county!!! Still lots of room to run according to this info.
AND!…I forgot to write what I initially intended…THANK YOU, Jim! This is a data-freak’s dream post. I love the info.
I call continued upside on the coast.
Agreed.
It used to be that as prices rose, more people would sell. But as we’ve seen prices rise 42% since 2009, that hasn’t been the case.
New Listings between Jan 1 and Sept 30:
2011: 4,308
2012: 3,655
2013: 4,091
2014: 3,930
2015: 4,058
The “re-freshing” of listings is still prevalent. They present some statistical noise, but even including those, the inventory count has been virtually the same for three years straight.
Will 2016 be the year that the inventory cuts loose?
Probably not, and my last graph in the post is why. People are staying longer, and those who have bought in the last few years are more inclined to stay for the duration, due to the difficulty of moving, and how fast prices went up.
This is a data-freak’s dream post. I love the info.
They have a good boomer section too, so I’ll include that later.
It’s frustrating that banks are colluding to keep foreclosures out of the market + keeping interest rates low to cause inflation. This is classic monopolistic behavior or because multiple agents are involved a better definition might be a cartel. It doesn’t matter what you call it because the results are the same. The product (in this case houses) are selling at artificially inflated prices.
I’m 100% behind business but what’s happening in houses in not free trade. Those who hold the assets are benefiting. While those looking to buy have to pay a premium much higher than they would if price manipulation wasn’t occurring.
Just an FYI the next step in the process is for salaries to increase to a level where the ability to buy a house is possible. Salaries always follow inflation it’s just a matter of how long it takes to hit a point of equilibrium. When it takes a long time for wages to increase to inflation levels it’s called Stagflation. People on minimum wage will get screwed, also retirees will get screwed because they can’t get a decent return on investments.
Speaking of VRBOs, there are going to be some heated debates:
http://www.nytimes.com/2015/10/10/your-money/new-worry-for-home-buyers-a-party-house-next-door.html?_r=0
Its not so good for chaps like Jim but a very good reason NEVER to move is……I have owned the Same house for 30 years, monthly mortgage bond payment? 42 US Dollars a month!
You should get with the program – I recommend that everyone should move every 6 to 12 months!
Don’t unpack, I’ll be back!