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I believe I am always divinely guided *I believe “GOD” will always make a way where there is no way.*I expect the best and with “GOD’S” help will attain the best.*I don’t believe in defeat.
C.A.R. releases its 2023 California Housing Market Forecast
Market shift under way as mild recession and higher interest rates cut into housing demand. Existing, single-family home sales are forecast to total 333,450 units in 2023, a decline of 7.2 percent from 2022’s projected pace of 359,220.
- California’s median home price is forecast to decline 8.8 percent to $758,600 in 2023, following a projected 5.7 percent increase to $831,460 in 2022. Housing affordability* is expected to drop to 18 percent next year from a projected 19 percent in 2022.
LOS ANGELES (Oct. 12) – A modest recession caused by an ongoing battle against inflation will keep interest rates elevated to suppress buyer demand and contribute to a weaker housing market in 2023, according to a housing and economic forecast released today by the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.). The baseline scenario of C.A.R.’s “2023 California Housing Market Forecast” sees a decline in existing single-family home sales of 7.2 percent next year to reach 333,450 units, down from the projected 2022 sales figure of 359,220. The 2022 figure is 19.2 percent lower compared with the pace of 444,520 homes sold in 2021. The California median home price is forecast to retreat 8.8 percent to $758,600 in 2023, following a projected 5.7 percent increase to $831,460 in 2022 from $786,700 in 2021. A less competitive housing market for homebuyers and a normalization in the mix of home sales will curb median price growth next year. “With the market shifting as home sales and prices are predicted to temper next year, buyers and sellers are adapting to the new realities of the market,” said C.A.R. President Otto Catrina, a Bay Area real estate broker and REALTOR®. “As sellers adjust their expectations, well-priced homes are still selling quickly. And for buyers: more homes for sale, less competition, and fewer homes selling above asking price, all point to a more favorable market environment for those who were outbid or sat out during the past two years when the market was fiercely competitive.”Are We Headed Into a Housing Bubble?
The Federal Reserve Bank of Dallas identified signs of a “brewing U.S. housing bubble” in a blog post at the end of March. Though the sharp increase in home prices in itself does not indicate a bubble, the report said, there are other fundamental factors to consider, including “shifts in disposable income, the cost of credit and access to it, supply disruptions, and rising labor and raw construction materials costs are among the economic reasons for sustained real house-price gains.” What causes the housing market to be “unhinged” from those fundamentals, is when “there is widespread belief that today’s robust price increases will continue,” the Dallas Fed report said. “If many buyers share this belief, purchases arising from a ‘fear of missing out’ can drive up prices and heighten expectations of strong house-price gains.”Even though the report called the current housing market “abnormal,” the authors concluded that “there is no expectation that fallout from a housing correction would be comparable to the 2007–09” crisis in terms of its magnitude.“Household balance sheets appear in better shape, and excessive borrowing doesn’t appear to be fueling the housing market boom,” said the report, adding that market participants and regulators are better equipped with tools and early warning detectors to thwart such a crisis.Why the Housing Market Will Likely Stay Hot If you were hoping for a major downturn to snag a cheaper home, think again.