Forecast Bodes Well for Home Sellers

Building on a stronger-than-expected showing this year, the California housing market will continue to generate higher sales and prices in 1998 as the state’s economy keeps expanding, according to a real estate forecast released Wednesday.

The median sales price of a single-family home should rise 4% during 1998 to $190,280, according to the California Assn. of Realtors, which released its 1998 Housing Forecast during its annual convention in Anaheim. Sales are expected to increase 5%.

“California will continue to outpace the nation in overall economic growth and job creation next year, which should further strengthen the housing market,” said Leslie Appleton-Young, chief economist for the association.

The forecast is in line with other recently released reports that show the state’s housing market continues to rebound from a deep and prolonged slump. The UCLA-Anderson Forecast Project, for example, estimated that the value of a typical home in Los Angeles County will grow nearly 5% next year.

This year, according to the real estate association, the median price of a single-family California home should rise by 3% to $182,960, compared with an original forecast of 2%. The larger-than-expected increase is primarily the result of a jump in sales of high-end properties and the robust real estate markets in the San Francisco Bay Area and Orange County. Those areas have benefited from the rapid expansion of high-technology companies.

“The Bay Area will continue to be a major contributor [to the recovery], but Southern California will be participating more,” said Appleton-Young. “We think Los Angeles is going to be a little bit above the statewide median.”

Real estate brokers and agents in many parts of Southern California say sales have been brisk and that prices have risen modestly or at least remained stable after years of decline.

In the eastern San Gabriel Valley, Glendora real estate broker Marty Rodriguez said most offers are coming within 2% of asking prices and that multiple bidders are not uncommon for bargain-priced properties. She credited the improvement to the return of move-up buyers, whose ranks nearly disappeared during the recession.

“That’s why the median sales price has gone up,” Rodriguez said. “You have a move-up market now.”

In Ventura, Nancy Amorteguy, who manages the local office of broker Jon Douglas, said sales volume is running 25% ahead of last year. A few homes near the coast have sold within a day of being listed, she said.

It is “as close to a seller’s market as we have had in many years,” Amorteguy said.