Skip to main content

Leslie Appleton-Young is the chief economist for the California Association of Realtors (CAR). She’s a smart lady (Go Bears!). On Tuesday, April 4, she presented her current thinking, research and outlook to the Laguna Board of Realtors at the Laguna Playhouse. I took notes from her presentation and am sharing some highlights with you here:
• This year, housing trends will look very much like last year
• Reasons for optimism:
o Stock market gains
o High level of consumer confidence
o Promise of Infrastructure spending
o Potential of Tax reform
o Regulatory reform (softer lending guidelines, more access to money)
• Some areas of concern:
o Household debt is going up
o Household reserves are going down
o Huge trade gap
o U.S. has experienced less than 3% year-over-year growth for the past 11 years
• Inflation is currently at about 2.8%, suggesting three more rate increases by the Fed this year
o Average mortgage rates for the year should hover around 4.6%
• Job growth appears to be accelerating
• There are fewer transactions taking place in California, in spite of a much higher population:
o More people are staying put and remodeling
o Long-term owners stay put due to lower mortgage payments, lower property taxes and avoidance of capital gains tax
o Average time between sales is now about ten years – the highest ever since this has been measured
o Number of homes for sale is lagging historical levels – typical supply is 6-7 months, the State is currently at 3-4 months supply
o Under-building is a concern since the downturn in 2008. 100,000 new jobs have been created in Orange County, but new housing has been built for only half that man.
• Inland Empire is leading in growth, due to more affordable housing prices
• Continued upward price trends at lower level
• Home ownership in California is currently at about 50%
o Predicts that California will predominantly be a renter state within five years
• The Gallup polling organization recently stated that consumers see real estate as the best investment

Let’s Talk

You’ve got questions and we can’t wait to answer them.

We use cookies and tracking technology in connection with your activities on our website. By viewing and using our website, you consent to our use of cookies and tracking technology in accordance with our Privacy Policy.