HAS THE CALIFORNIA REAL ESTATE MARKET HIT BOTTOM?
INDUSTRY NEWS, SHASTA COUNTY, TIPS FOR BUYERS, TIPS FOR SELLERS
September 20th, 2008
The Real Estate Market
The short answer is, it depends! It depends on where you live in California. The Inland Empire and Central Valley appear to have experienced the bulk of their price declines but the San Fransisco Bay Area and SoCal may see further declines according to some analysts.
The difficulty in predicting the turnaround is this crisis is different from any other down cycle we have experienced in the past. Unemployment was the trigger of the market shift in the 1990’s that stalled the market for a five-year period. This cycle saw a huge drop in activity in 2006-2007 and marked improvement in sales in 2008. Homes sales have remained above 400,000 units/month for the third consecutive month.
With the fast and deep price declines has come a sharp increase in affordability. In one year’s time, California affordability indexed doubled from 24% to 48%. This has brought home prices more in line with wage incomes.
Beware of false starts, or periods when prices rise then plateau and even fall back again according to some economists. Remember this, real estate is cyclical, like many businesses, and will rebound over time.
530-224-6767 or 530-941-7492
BRAD GARBUTT
REALTOR/BROKER ASSOCIATE
REAL ESTATE PROFESSIONALS GMAC
QUARTER CENTURY LOACL REAL ESTATE EXPERIENCE
