A Monthly Review of the Big Bear Real Estate Market Provided by Mike Dolan
The housing market continues to show strong improvement. Reports show that the U.S. housing market continues to improve. Prices are being bolstered by continued lack of supply. However, the consensus that mortgage rates may begin ticking up by this summer has many of us in the business a little concerned.
California’s housing market is expected to improve in 2016, but a shortage of available inventory and continuing high costs are expected to limit huge gains. In 2014 there were 383,300 home sales. In 2015 there were approximately 407,500 home sales. The California Association of Realtors (CAR) forecast calls for 433,000 home sales in 2016.
The state’s rising prices are predicted to hold back home sales slightly. The California median home price is projected to increase 3.2% to $491,300 in 2016 (following a 6.5% increase in 2015). Despite those increases, 2016 is still estimated to have the slowest rate of price appreciation in five years. CAR predicts interest rates for a 30-year, fixed mortgage will be stable at 4.5% for the next several months (which are still historically low levels).
Solid job growth and favorable interest rates will always drive strong demand for housing. However, in regions where inventory is tight, such as the San Francisco Bay Area, sales could be limited by diminishing housing affordability. On the other hand, demand in less expensive areas such as Riverside/San Bernardino will remain strong thanks to solid job growth in warehousing, transportation, logistics and manufacturing.
The Big Bear real estate market is expected to equal (or slightly exceed) 2015 numbers, both in number of sales and average price. December and January are typically slow months for new sales (particularly due to the weather this season). However, the skier visits are at a record high and snow levels will definitely add to our lake (all creating an increase in demand for our upcoming selling season).
Provided by Mike Dolan