This Was The Week Of The CAR Expo, This Year Called REImagine
One of the highlights every year is the Housing Market Forecast presented by the CAR SENIOR VICE PRESIDENT AND CHIEF ECONOMIST, LESLIE APPLETON YOUNG, the guru of gurus. What did she say this year?
- A combination of high home prices and eroding affordability is expected to cut into housing demand and contribute to a weaker housing market in 2019, and 2018 home sales will register lower for the first time in four years.
- A.R.’s “2019 California Housing Market Forecast” sees a modest decline in existing single-family home sales of 3.3 percent next year to reach 396,800 units, down from the projected 2018 sales figure of 410,460 and the 424,100 sales in 2017
- While home prices are predicted to temper next year, interest rates will likely rise and compound housing affordability issue
- The average for 30-year, fixed mortgage interest rates will rise to 5.2 percent in 2019.
- The California median home price is forecast to increase 3.1 percent to $593,450 in 2019, following a projected 7.0 percent increase in 2018 to $575,800.
2019 California Housing Forecast
|SFH Resales (000s)||414.9||382.7||409.4||417.7||424.1||410.5||396.8|
|Median Price ($000s)||$407.2||$446.9||$476.3||$502.3||$538.0||$575.8||$593.4|
|Housing Affordability Index*||36%||30%||31%||31%||29%||28%||25%|
|30-year fixed rate||4.0%||4.2%||3.9%||3.6%||4.0%||4.7%||5.2%|
p = projected
f = forecast
* = % of households who can afford median-priced home
7. So what do you think is going to happen by December 31, 2019? I do not like the estimate that sales will be down and that there will not be my annual 7% uptick in my rental homes. That affordability index has been taking some hits.