California Real Estate Market Trends & Forecast
The shutdown due to coronavirus pandemic had an impact on the California economy and the real estate sector well. Home sales dropped over the past couple of months but prices remain high. Southern California home sales fell 26.6% in April compared with a month earlier, while year-over-year sales were down by 31.5%.
In April 2020, the median sold price of existing single-family homes in the Los Angeles Metro Area was $550,000, a year-over-year increase of 2.5%.
Based on the date of Master Score, STAR, TAPS, 1 year THAR, we can summarize the current market state as Weak.
– 9% in Master Score
– STAR – 5%
– TAPS – 3%
– 1 Year THAR – 11%
What do all of these metrics mean?
- Master Score – low Master Score indicates the weakness of the current real estate market in California
- STAR – indicates the market’s momentum which is super low for California real estate market
- TAPS – such low Technical Analysis Point Score reduces the investment appeal for potential real estate investors
- 1 Year THAR – low Total Home Appreciation Rate tells us that California real estate market has negative growth trend.
While the mortgage rates are expected to go even lower in 2020, the population growth will still remain low, due to people moving out to other states with lower housing costs. The supply and demand of housing in California is going to be more balanced in 2020, and buyers will have more choices and negotiation power. With that being said, due to uncertainties in the economy, the presidential election, and the trade war, there might be more motivated sellers in the market, causing some negative distortions in the market. But, in general, the housing market in California will still be balanced.
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