Home sales in California are expected in increase in 2017 as price appreciation slows down, according to a forecast from the California Association of Realtors.
CAR predicts that existing home sales will increase 1.4% from 2016 to 413,000 units, based on the 2016 projected sales figure of 407,300 homes. On a regional basis though, home sales are expected to vary quite a bit, according to Pat Zicarelli, the organization's president.
"Next year, California's housing market will be driven by tight housing supplies and the lowest housing affordability in six years," Zicarelli said in a news release.
"The market will experience regional differences, with more affordable areas, such as the Inland Empire and Central Valley, outperforming the urban coastal centers, where high home prices and a limited availability of homes on the market will hamper sales."
Zicarelli added that the Southern and Central Valley regions of California should expect moderate sales increase, while the San Francisco Bay Area will likely see a decline driven by a lack of affordability.
Regarding affordability, CAR also forecast that median home prices will rise 4.3% from projected 2016 levels to $525,600. The 2016 projection itself is 6.2% higher than a year ago at $503,900, though this is the slowest price appreciation rate CAR has noted in six years.
