With another year to add to the history books, it’s time to look ahead at what to expect in 2016 for our local real estate markets. In their 2016 California Economic and Market Forecast Report, the California Association of Realtors projects modest but continued improvements to our local housing markets. Here are a few highlights:
- Forecast sees an increase in existing home sales of 6.3 percent next year
- Projects increase in U.S. GDP of 2.7 percent in 2016, after a projected gain of 2.4 percent in 2015
- The State’s unemployment rate should decrease to 5.5 percent in 2016 from 6.3 percent in 2015 and 7.5 percent in 2014
- 30-year, fixed mortgage interest rate averages will rise only slightly to 4.5 percent but will still remain at historically low levels
- Median home prices in CA are schedules to increase 3.2 percent to $491,300 in 2016
2016 will also be unique in that there are some pretty significant wildcards to expect that could change the local real estate market trajectory. For example, the 2016 Presidential election and other things like El Niño and/or the water shortage could impact things significantly. However, the general consensus from the California Association of Realtors is that we should expect a mild slowdown, but still solid market growth in 2016.
For a more in-depth look at the Orange County real estate market’s performance over the past year, take a look at the attached report.