California’s real estate trade association projects that 2010 will mark a “new normal” for the state’s residential real estate market.
“This 'new normal’ likely will feature a steady stream of sales driven by distressed properties in the low end of the market, coupled with moderate home-price appreciation,” California Association of Realtors president James Liptak said in a news release Wednesday announcing the organization’s annual forecast.
Real estate prices have fallen so sharply in so many places that the statewide assessed valuation of California property declined this year for the first time since the state Board of Equalization began keeping records in 1933.
That happened despite the cushioning impacts of the state’s Proposition 13 tax limits, under which most properties are not reassessed every years.
“After experiencing its sharpest decline in history, we expect the median price to rise modestly next year,” Liptak said Wednesday.
The realtors project that the median home price in California will rise 3.3% to $280,000 in 2010, while actual sales transactions are expected to drop 2.3% to 527,000.
The residential real estate market has fragmented, with differing results at differing price points, according to Liptak.
“The low end continues to attract first-time buyers and investors, with a resulting shortage in the number of homes for sale,” he said. “Sellers at the high end, however, continue to be challenged by the ability of home buyers to secure financing as well as their concerns about where prices are headed.”
