In 2020, the U.S. housing market’s combined worth touched the mark of $33.6 trillion, and the California real estate market has a significant share in it. From the global pandemic to California wildfire – California housing trends have shown various low and high points. In this, if you are interested in buying a property in the golden state, you have to understand the Southern California housing price history and trends carefully.
California Housing Market: Home Prices & Trends 2020
In the midst of a pandemic, when the global real estate market is struggling, it is impossible for the California housing market to not receive the heat. As per California Weekly Data, the overall California real estate market is showing a steep decline in all the regions such as –
- 20.1% dip in the Central Coast
- 18.7% fell in Southern California
- 14.3% down in Northern California
- 12.5% decline in the Central Valley
- 9.5% drop in the Bay Area
California Housing Market: Home Prices & Trends 2020
Source: Norada Real Estate
In the midst of a pandemic, when the global real estate market is struggling, it is impossible for the California housing market to not receive the heat. As per California Weekly Data, the overall California real estate market is showing a steep decline in all the regions such as –
- 20.1% dip in the Central Coast
- 18.7% fell in Southern California
- 14.3% down in Northern California
- 12.5% decline in the Central Valley
- 9.5% drop in the Bay Area
However, it is evident that the California real estate market is highly affected due to COVID-19, but the house prices in California aren’t showing a downside curve. Home prices in California have surged by 8.1%. The cost of one medium house prices in California has increased from $592,450 in 2019 to $648,760 in 2020. So, we can say that the pandemic has impacted the real estate market, but not prices.
Besides the California home prices, one should watch out for some other vital housing market trends too. Such as –
- Lower Mortgage Rates – The Federal Reserve has already declared an emergency and cut down their interest rates. Furthermore, the Fed has suggested that they are open to further reductions keeping the slow financial market. This will help home loan takers and make buying a house a little affordable.
- Reduced Luxury Home Market – No one can deny that the financial market is slow right now. The limited financial resources have changed the approach of buyers as now they want to buy a practical family home under their reduced income rather than a luxury home. It resulted in the reduction of luxury homes demand in California.
- Foreign-Home Buyers Won’t be Active – Due to the derailed global economy, the impact on California real estate market can be seen. California home sales are represented by 3.9% of foreign buyers, so the impact might be less, but this is going to be a small hiccup for the real estate market.
- Slow Construction – California Building Industry outsources many resources from Asian countries. But, due to lockdown in many Asian countries, the supply chain has been disturbed, which is going to slow down the construction industry dramatically.
Why Do People Love to Live in California?
If you are wondering why California home prices are hiking up despite the global financial crisis, simply because people love to settle down in California. It is the perfect place to embrace your freedom, raise your family, and get old.
Here are a few reasons why people love to live in California:
- Multiple Seasons – You can experience all the seasons gifted by Mother Nature in California. From the sweet rainfall during the winter to a moderate amount of snowfall, you will get everything in California. And, the fun part is that you don’t have to shovel snow out of your driveway or have to carry an umbrella daily. The weather is simply perfect here.
- Natural Galore – California is highly gifted by nature – Joshua Tree, Yosemite, Death Valley, Redwood Trees, and edgy coastline are some of the best places in California. Moreover, who wouldn’t want to visit Disneyland and famous California Adventures with his family?
- Foodies Paradise – If you love good food, you have so many options in California. You can hope from a Mexican taco truck to a refined Italian restaurant in one go. And, fortunately, if your life is incomplete without a glass of Chardonnay or pinot, Napa Valley and Santa Barbara can be your lifesavers.
- Treat for Pets – When you want to live in a pet-friendly city, San Francisco and LA are the best places in California. In cities like LA, you can find more pup salons and boutiques rather than schools for your children. Thus, if you want to be surrounded by adorable pups, cats, or other animals, California is your home.
- Eat Healthy Around the Year – Central California is one of the largest fresh produce areas. From the famous artichokes to the special California almonds, you can grab a variety of fresh produce from your local story daily and prepare a delicious treat for your family. For a healthy and happy lifestyle, California has all the right places.
California Housing Market Trends 2021
If you are excited to buy a home in California, you should keep an eye on the following California housing market trends 2021:
- Price Will Rise – The California Association of Realtors reported that California home prices might surpass the golden figure of $700K for the first time in the Southern California housing price history. It has seen a whopping growth of 6.1 from July 2020.
- Sale Will Rise – Despite the increased prices, a rise in home sales is anticipated. With low mortgage rates and a constant increase in the prices, buyers are likely going to take advantage of the situation.
- Inventory will Drop – Home demand in California will perk up in the coming time leading to less inventory availability. With attractive deals in the offing, the drop in the major listings across California will be seen; the Southern California housing market is top among the regions with a straight YoY drop of 52.4%.
- Sellers or Buyers Market – Overall, the low mortgage rates and tight inventory will turn the California housing market into a seller’s market. In 2021, sellers are likely going to see growth in their business.
Conclusion
California’s real estate market is a roller coaster of many ups and downs. From the slows of mid-2020 to the gradual rise in 2021, California always stays among the top residential favourites places. Thus, whether you want to buy a family or investment property in California, today is a good time.
