Home Sales Booming at IRES
If you were a seller, the Southern California housing market was a good one last year.
The economy improved. Sales jumped after a lethargic 2014. And prices climbed even higher, making an already expensive region even more so. By the end of November, the median home price for the six-county market was $438,000, up 6.8% from the same month a year earlier, according to the data from CoreLogic.
Still, the real estate frenzy cooled through late summer and fall. To what extent the slowdown could be blamed on the typical seasonality of home sales or to the price hikes that have made housing increasingly unaffordable is unclear. A better picture of the market's health should emerge during the busy spring buying season.
Economists generally expect further improvement in the market, though they predict that the price increases will slow as fewer families are able to buy into it — a trend that started in 2013.
“Affordability is dulling demand,” said Leslie Appleton-Young, chief economist for the California Assn. of Realtors, which projects the state's median home price to increase 3.2% this year, about half the pace of the 6.2% gain in 2015.
For now, many of Los Angeles County's hottest burbs fall into two categories: Westside areas in the midst of a tech-industry boom and communities near downtown coveted for their older homes and short drive to an increasingly vibrant city center.
Even with the demand, some of these neighborhoods are seeing sales fall amid a lack of inventory, but Appleton-Young said they are likely to see further price growth. And despite affordability constraints, she's bullish on Southern California's housing market for the year.
“The signs are good,” she said, citing predictions for job and wage growth that should support the overall economy.
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