2019 Mid-Year Market Forecast

2019 Mid-Year
Market Forecast
July 10, 2019
Leslie Appleton-Young
SVP & Chief Economist
And Jordan Levine
Deputy Chief Economist

CALIFORNIA ASSOCIATION OF REALTORS®
Economic fundamentals remain solid
page
3
GDP 3.1%
2019-Q1
Consumption 0.9%
2019-Q1
Unemployment 3.7%
June 2019
Core CPI 2.0%
May 2019
Job Growth 1.5%
June 2019

Unemployment at lowest
rate in 50 years
page
4
1.9%
2.1%
2.3%
2.6%
2.6%
2.8%
3.0%
3.2%
3.5%
3.5%
3.6%
3.8%
4.0%
6.0%
7.7%
8.4%
0% 2% 4% 6% 8% 10%
San Mateo
San Francisco
Santa Clara
Orange
San Luis Obispo
Contra Costa
San Diego
Ventura
Sacramento
Santa Barbara
San Bernardino
Riverside
Los Angeles
San Joaquin
Fresno
Kern
0
2
4
6
8
10
12
14
Sep-76
Sep-78
Sep-80
Sep-82
Sep-84
Sep-86
Sep-88
Sep-90
Sep-92
Sep-94
Sep-96
Sep-98
Sep-00
Sep-02
Sep-04
Sep-06
Sep-08
Sep-10
Sep-12
Sep-14
Sep-16
Sep-18
US

0
20
40
60
80
100
120
140
160
Jan-05
Sep-05
May-06
Jan-07
Sep-07
May-08
Jan-09
Sep-09
May-10
Jan-11
Sep-11
May-12
Jan-13
Sep-13
May-14
Jan-15
Sep-15
May-16
Jan-17
Sep-17
May-18
Jan-19
INDEX,100=1985
Consumers confidence remained elevated
page
5
June 2019: 121.5
SERIES: Consumer Confidence
SOURCE: The Conference Board

Fed may Lower rates in 2019 – WHAT?
page
6
January 2012 – April 2019
3.80
3.75
3.48 3.45
2.5 2.5
0
1
2
3
4
5
6
FRM
ARM
Fed Funds Rate
MONTHLY WEEKLY
January 2012 – July 2019
SERIES: 30Yr FRM, 5Yr ARM, Fed Funds Rate (Target Rate)
SOURCE: Freddie Mac, St. Louis Fed

Rates drop lower mortgage payment
page
7
SERIES: Monthly Mortgage & Min. Qualifying Income
SOURCE: CALIFORNIA ASSOCIATION OF REALTORS®
Q1-2019 Median Price $545,820
20% Downpayment
$1,841
$1,961
$2,085
$2,212
$2,344
$2,479
$2,618
$2,760
$0
$400
$800
$1,200
$1,600
$2,000
$2,400
$2,800
$3,200
3.0% 3.5% 4.0% 4.5% 5.0% 5.5% 6.0% 6.5%
Monthly Mortgage
$98,746
$103,539
$108,494
$113,607
$118,870
$124,279
$129,827
$135,506
$-
$20,000
$40,000
$60,000
$80,000
$100,000
$120,000
$140,000
$160,000
3.0% 3.5% 4.0% 4.5% 5.0% 5.5% 6.0% 6.5%
Minimum Qualifying Income

Mortgage payment continued to decline
-10%
-5%
0%
5%
10%
15%
20%
YTY%Chg.
California Median Price vs. Mortgage Payment
Price Growth Mortgage Pmt Growth
page
8
SERIES: Price Growth vs. Mortgage Payment Growth

Why low rates aren’t spurring even
more home sales
• Rates aren’t everything
• Financial incentives to trade-up have
disappeared: SALT cap
• Home prices at all time highs
• Inventory is still constrained – lots of competition;
little choice
• 1st time buyers have limited options
page
9

Always Lots of Wildcards
page
10
• Mortgage rates
• Financial market turmoil/Fed policy
• GSE Reform
• Tax Bill Impacts
• 2019 ipo’s: uber, lyft, airbnb, slack, wework, planatir tech,
pinterest, postmates, robinhood

Attitude towards buying and selling
57% 56%
51%
46% 48% 50% 53%
48% 45%
51%
22% 21%
27% 25% 22% 25% 24% 22% 22% 26%
Do you think it’s a good time to sell a
home in California?
N=300
Do you think it’s a good time to buy a
home in California?
N=300
page
12
SERIES: 2018/2019 Google Consumer Poll

Existing Home Sales
% change
(Not seasonally adjusted)
-0.6% YTY
Sales down, price set record, inventory up
page
013
Price
$611,190
+1.7% Y2Y
Unsold
Inventory Index
3.2 months
+6.7% Y2Y
Median Days
on Market
18 days
+20.0% Y2Y
Sales Price to
List Price Ratio
99.3%
-0.7% Y2Y
May 2019
-6.0% YTD

Sales above 400k for the first time in 10 months
California, May 2019 Sales: 406,960 Units
-
100,000
200,000
300,000
400,000
500,000
600,000
700,000
Jan-05
Sep-05
May-06
Jan-07
Sep-07
May-08
Jan-09
Sep-09
May-10
Jan-11
Sep-11
May-12
Jan-13
Sep-13
May-14
Jan-15
Sep-15
May-16
Jan-17
Sep-17
May-18
Jan-19
page
14
SERIES: Sales of Existing Single Family Homes
SOURCE: CALIFORNIA ASSOCIATION OF REALTORS®*Sales are seasonally adjusted and annualized

Underperform in low and high price ranges
May 2019 (YTY% Chg.)
-13.0%
1.8%
5.2%
3.8%
2.0%
-4.2%
-0.3%
-14%
-12%
-10%
-8%
-6%
-4%
-2%
0%
2%
4%
6%
8%
page
15
SERIES: Sales of Existing Detached Homes

Sales by region
page
16
-2.7%
0.8%
-0.9%
-4.2%
-0.9%
-5.0%
-4.0%
-3.0%
-2.0%
-1.0%
0.0%
1.0%
2.0%
May 2019 Home Sales Growth
by Region
Central
Valley,
22%
S.F. Bay
Area,
20%
Southern
California,
47%
Central
Coast,
4%
Other
Counties,
7%
May 2019 Home Sales by Region

Bay Area sales up for the first time since July 2018
page
17
County May-18 May-19 YTY% Chg. YTD% Chg.
Alameda 1,013 1,034 2.1% 0.9%
Contra Costa 1,090 1,172 7.5% -5.5%
Marin 239 244 2.1% 2.6%
Napa 104 115 10.6% -8.3%
San Francisco 236 234 -0.8% 2.4%
San Mateo 452 420 -7.1% -1.8%
Santa Clara 1,097 1,017 -7.3% -8.7%
Solano 427 433 1.4% -3.1%
Sonoma 390 420 7.7% -5.5%

So. California sales began to trend up
page
18
Los Angeles 3,987 3,989 0.1% -6.7%
Orange 1,725 1,691 -2.0% -7.6%
Riverside 2,328 2,363 1.5% -6.5%
San Bernardino 1,373 1,227 -10.6% -12.5%
San Diego 2,208 2,213 0.2% -2.5%
Ventura 461 492 6.7% -1.0%

Sales of existing single-family homes – Central Valley
page
19
Fresno 828 764 -7.7% -10.4%
Glenn 31 18 -41.9% 27.6%
Kern 624 549 -12.0% -2.3%
Kings 104 113 8.7% -5.9%
Madera 177 195 10.2% 9.5%
Merced 145 162 11.7% -4.9%
Placer 614 629 2.4% -1.3%
Sacramento 1,693 1,596 -5.7% -9.3%
San Benito 65 49 -24.6% -28.0%
San Joaquin 631 638 1.1% -5.2%
Stanislaus 507 545 7.5% -1.1%
Tulare 350 355 1.4% -1.8%

Sales of existing single-family homes – Central Coast
page
20
Monterey 2,574 2,578 0.2% -10.2%
San Luis Obispo 3,106 2,970 -4.4% -4.6%
Santa Barbara 2,697 2,483 -7.9% -1.1%
Santa Cruz 1,826 1,793 -1.8% -16.1%

Sales of existing single-family homes – Other counties
page
21
Butte 166 179 7.8% 36.3%
Calaveras 130 107 -17.7% -12.0%
Del Norte 19 14 -26.3% -26.3%
El Dorado 299 288 -3.7% -15.0%
Humboldt 113 127 12.4% 2.4%
Lake 81 81 0.0% -15.2%
Lassen 29 29 0.0% 0.0%
Mariposa 18 21 16.7% 13.0%
Mendocino 57 62 8.8% 12.3%
Mono 10 6 -40.0% 21.1%

Sales of existing single-family homes – Other counties
page
22
Nevada 121 137 13.2% 4.7%
Plumas 39 25 -35.9% 16.2%
Shasta 271 297 9.6% 9.1%
Siskiyou 50 46 -8.0% -10.7%
Sutter 92 73 -20.7% -20.1%
Tehama 35 49 40.0% 44.6%
Tuolumne 73 73 0.0% -15.0%
Yolo 180 146 -18.9% -9.6%
Yuba 85 91 7.1% 0.0%

Price hit new high but slow growth
California, May 2019: $611,190, +1.4% MTM, +1.7% YTY
$-
$100,000
$200,000
$300,000
$400,000
$500,000
$600,000
$700,000
Jan-05
Sep-05
May-06
Jan-07
Sep-07
May-08
Jan-09
Sep-09
May-10
Jan-11
Sep-11
May-12
Jan-13
Sep-13
May-14
Jan-15
Sep-15
May-16
Jan-17
Sep-17
May-18
Jan-19
page
23
SERIES: Median Price of Existing Single Family Homes

Soft at the high-end
6.3%
3.5%
1.0%
0.1%
-1.4% -1.7% -1.4%
-0.7% -0.5%
-3%
-2%
-1%
0%
1%
2%
3%
4%
5%
6%
7%
0-20 20-40 40-60 60-80 80-100 80-85 86-90 91-95 96-100
Percentile
California Year-over-Year Price Growth by Quintile (May 2019)
page
24
SERIES: Median Price of Existing Single Family Homes

Median price – Bay Area
page
25
SERIES: Median Price of Existing Detached Homes
County May-18 May-19 YTY% Chg.
Alameda $1,025,000 $959,000 -6.4%
Contra Costa $687,500 $700,355 1.9%
Marin $1,415,000 $1,400,000 -1.1%
Napa $702,500 $725,000 3.2%
San Francisco $1,620,000 $1,697,500 4.8%
San Mateo $1,600,000 $1,766,500 10.4%
Santa Clara $1,400,000 $1,335,000 -4.6%
Solano $451,000 $446,000 -1.1%
Sonoma $698,500 $666,000 -4.7%

Median price – Southern California
page
26
Los Angeles $536,940 $539,480 0.5%
Orange $838,000 $845,000 0.8%
Riverside $409,920 $420,000 2.5%
San Bernardino $285,000 $315,000 10.5%
San Diego $640,000 $650,000 1.6%
Ventura $670,000 $659,500 -1.6%

Median price – Central Valley
page
27
Fresno $279,980 $284,900 1.8%
Glenn $230,000 $245,000 6.5%
Kern $247,750 $252,000 1.7%
Kings $235,000 $260,000 10.6%
Madera $259,000 $270,000 4.2%
Merced $262,000 $285,000 8.8%
Placer $499,650 $514,900 3.1%
Sacramento $375,000 $385,000 2.7%
San Benito $579,900 $600,000 3.5%
San Joaquin $367,860 $380,000 3.3%
Stanislaus $325,000 $335,000 3.1%
Tulare $234,950 $248,000 5.6%

Median price – Central Coast
page
28
Monterey $677,000 $639,000 -5.6%
San Luis Obispo $638,660 $640,000 0.2%
Santa Barbara $680,000 $696,000 2.4%
Santa Cruz $865,000 $935,000 8.1%

Median price – Other counties
page
29
Butte $324,100 $359,000 10.8%
Calaveras $329,000 $375,000 14.0%
Del Norte $214,000 $256,850 20.0%
El Dorado $552,000 $521,380 -5.5%
Humboldt $314,900 $315,000 0.0%
Lake $263,400 $267,000 1.4%
Lassen $215,000 $205,000 -4.7%
Mariposa $320,000 $295,000 -7.8%
Mendocino $420,000 $388,500 -7.5%
Mono $852,500 $564,500 -33.8%

Median price – Other counties
page
30
Nevada $404,000 $420,000 4.0%
Plumas $310,000 $350,500 13.1%
Shasta $264,000 $285,000 8.0%
Siskiyou $210,000 $235,000 11.9%
Sutter $281,000 $319,900 13.8%
Tehama $197,500 $243,000 23.0%
Tuolumne $300,000 $310,000 3.3%
Yolo $476,500 $469,500 -1.5%
Yuba $297,500 $311,000 4.5%

Inventory Index up due primarily
to increase in active listings
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
18.0
Jan-05
Sep-05
May-06
Jan-07
Sep-07
May-08
Jan-09
Sep-09
May-10
Jan-11
Sep-11
May-12
Jan-13
Sep-13
May-14
Jan-15
Sep-15
May-16
Jan-17
Sep-17
May-18
Jan-19
page
31
SERIES: Unsold Inventory Index of Existing Single Family Homes
May 2018: 3.0 Months; May 2019: 3.2 Months

Inventory Index Highest in Millions
2.8 2.8 2.8
3.3
2.8 3.0
3.4
3.9
7.5
3.02.9 2.8 3.0
3.6
3.0
3.9 4.1
4.4
8.4
3.2
0
1
2
3
4
5
6
7
8
9
Under
$300K
$300-
$500K
$500-
$750K
$750K-$1M $1-$1.25M $1.25-
$1.5M
$1.5-$2M $2-$3M $3M + Total
California Unsold Inventory Index by Segment
May-18 May-19
page
32
SERIES: Unsold Inventory Index of Existing Single Family Homes

Active listings had smallest
growth since April 2018
7.4%
-20%
-10%
0%
10%
20%
30%
40%
Jan-15
Mar-15
May-15
Jul-15
Sep-15
Nov-15
Jan-16
Mar-16
May-16
Jul-16
Sep-16
Nov-16
Jan-17
Mar-17
May-17
Jul-17
Sep-17
Nov-17
Jan-18
Mar-18
May-18
Jul-18
Sep-18
Nov-18
Jan-19
Mar-19
May-19
Year-over-Year % Chg
page
33
SERIES: Active Listing of Existing Single Family Homes

Supply improved in all but
the lowest price segment
May 2019
-6.9%
1.1%
12.1%
15.9% 16.0%
11.0%
7.4%
-10%
0%
10%
20%
Active Listing
page
34
SERIES: Active Listings of Existing Single Family Homes

Active listings increased
in all regions
6,148
27,680
10,284
2,618
8,024
28,998
10,407
2,721
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
San Francisco Bay
Area
Southern California Central Valley Central Coast
ActiveListings
May-18 May-19
page
35
SERIES: Active Listings of Existing Single Family Homes

Active listings increased
in all regions
0.8%
-0.9% -2.7% -4.2%
30.5%
4.8%
1.2%
3.9%
-10%
0%
10%
20%
30%
40%
San Francisco Bay
Area
Southern California Central Valley Central Coast
Year-to-Year%Chg
Sales Active Listings
May 2019
page
36
SERIES: Sales and Listings of Existing Single Family Homes

Housing affordability remains an issue
page
37
California, 1984-2019
CA, 32%
US, 57%
0%
10%
20%
30%
40%
50%
60%
70%
80%
%OFHOUSEHOLDSTHATCAN
BUYAMEDIAN-PRICEDHOME
Annual Quarterly
SERIES: Housing Affordability Index of Traditional Buyers

Many simply can’t afford to buy
page
38
SERIES: Housing Affordability Index of Traditional Buyers
63%
57%
32%
10%
0%
10%
20%
30%
40%
50%
60%
70%
2019-Q1: % able to purchase median-priced home

How wages stack up against prices?
$31,460
$80,100 $81,580
$101,380 $106,950
$127,950 $126,490
$0
$20,000
$40,000
$60,000
$80,000
$100,000
$120,000
$140,000
Retail
Salespersons
Teachers Firefighters Police Nurses Developers Min. Inc
Required to
Buy a Med.
Home
California
2018 Annual Mean Wage
page
39
SOURCE: Bureau of Labor Statistics, C.A.R.

CA’s Homeownership< U.S.
• Click to edit Master text styles
• Second level
• Third level
• Fourth level
• Fifth level
53.7%
Peak: 60.2%
54.4%
64.5%
Peak: 69.0%
63.9%
45%
50%
55%
60%
65%
70%
75%
CA US
page
040
SERIES: Homeownership Rates
SOURCE: U.S. Census Bureau

Majority renter cities will surprise you
76.0%
50.7%
0%
10%
20%
30%
40%
50%
60%
70%
80%
Hawthorne
SantaMonica
EastLosAngeles
Glendale
Inglewood
SanFrancisco
LosAngeles
Bellflower
Alhambra
ElCajon
Florence-Graham
Oakland
CostaMesa
Merced
LongBeach
Burbank
Arden-Arcade
MountainView
SantaBarbara
ElMonte
Pasadena
SantaClara
SouthGate
Chico
Lynwood
Berkeley
Anaheim
Alameda
Salinas
SantaAna
SantaCruz
Davis
Madera
Sunnyvale
Irvine
Tustin
SanDiego
Fresno
Lodi
Sacramento
SanBernardino
Escondido
2017 California Renter Rate by City
page
41
SERIES: Homeownership Rates
SOURCE: U.S. Census Bureau

Here’s the problem:
At some point a supply problem
becomes a demand problem.

~750k people have left since 2010
page
43
-169,336
-57,563
-24,972
-60,839
-41,362
-104,317
-163,922
-105,210
-180,000
-160,000
-140,000
-120,000
-100,000
-80,000
-60,000
-40,000
-20,000
0
2010 2011 2012 2013 2014 2015 2016 2017
California Net Domestic Migration

Step 1: SF Bay to Cheaper Markets
-8,559 -9,005
-11,659
-12,408
-13,053
-15,244
-17,697
-25,843
-30,268
-42,777
Merced Solano Washington Stanislaus Santa Cruz Texas Nevada (ST) Oregon San Joaquin Sacramento
MSA
Core San Francisco Bay Area Out Migration (2010-2016)
Another State
Elsewhere in CA
page
44

Step 2: Pricing Prior Residents Out of State
-2,260
-2,715 -2,917
-3,596
-4,002 -4,029 -4,179
-5,020 -5,127
-8,166
Kentucky Santa Cruz Oklahoma Colorado Sutter &
Yuba
San Luis
Obispo
San
Bernardino
Oregon Idaho Nevada (ST)
Sacramento MSA Out Migration
(2010-2016)
Elsewhere in CA
Another State
page
45

Step 1: SoCal coastal to cheaper markets
page
46
-19,854
-21,935
-34,217 -40,361
-42,503
-48,609
-65,534
-79,132
-101,914
-124,148
Santa
Barbara
Colorado Oregon Washington Kern Nevada
(ST)
Arizona Texas San
Bernardino
Riverside
Coastal Southern California Out Migration (2010-2016)
Elsewhere in CA
Another State

Step 2: pricing prior residents out of state
page
47
-3,575
-5,117
-7,732 -7,970 -8,344
-10,604
-10,680
-10,699
-16,374
-17,859
Hawaii Colorado Nevada
(ST)
Idaho North
Carolina
Utah Georgia Kern
County
Arizona Texas
Inland Empire Out Migration
(2010-2016)
Elsewhere in CA
Another State

Best performing cities are
everywhere Milken Institute Annual Report 2018

the rules of the game are changing and it's all
about jobs and housing. not just about the
coasts anymore

Top 10 best performing large cities
page
50Source: Milken Institute
Provo-Orem,
UT MSA
Change: Steady
San Jose-
Sunnyvale-Santa
Clara, CA MSA
Change: +9
Austin-Round
Rock, TX MSA
Change: +6
San Francisco-
Redwood City-
South SF, CA MD
Change: Steady
Dallas-Plano-
Irving, TX MD
Change: -2
1 2 3 4 5
6 7 8 9 10
Raleigh, NC
MSA
Change: -4
Orlando-
Kissimmee-
Sanford, FL MSA
Change: Steady
Seattle
Bellevue-
Everett, WA MD
Change: +9
Fort Collins,
CO MSA
Change: -4
Salt Lake City,
UT MSA
Change: Steady

35
35
35
36
36
48
49
52
54
56
Trenton, NJ MSA
Tallahassee, FL MSA
Albuquerque, NM MSA
Kennewick-Richland, WA MSA
Scranton-Wilkes-Barre-Hazleton, PA MSA
Myrtle Beach-Conway-North Myrtle Beach, SC-NC…
Lansing-East Lansing, MI MSA
Tucson, AZ MSA
Norwich-New London, CT MSA
Merced, CA MSA
Biggest gains among large cities
page
38
123
102
89
51
85
148
66
82
125
Metropolitan Statistical Area (MSA)/
Metropolitan Division (MD) 2018 Rank Change

Top 10 best performing small cities
page
1 2 3 4 5
6 7 8 9 10
Gainseville,
GA MSA
Change: Steady
Coeur
d’Alene, ID
MSA
Change: +24
Medford, OR
MSA
Change: +21
Albany, OR
MSA
Change: +13
Logan, UT-ID
MSA
Change: +14
Bend-
Redmond,
OR MSA
Change: Steady
St. George,
UT MSA
Change: Steady
Elkhart-
Goshen, IN
MSA
Change: +2
Athens-Clark
County, GA
MSA
Change: +34
San Rafael,
CA MSA
Change: -2

Homeownership? Aspirational v. Attainable
• Click to edit Master text styles
• Second level
• Third level
• Fourth level
• Fifth level
page
53
• The desire for homeownership remains strong
• First-time buyers face often insurmountable obstacles
• Government policies do not support housing as in the past
• More Millennials are making the difficult choice to leave
• Their ability to build wealth over time is compromised
• Where will our children live?

Homeownership still aspirational
8%
13%
29%
27%
23%
0%
10%
20%
30%
Percent
n: 1663
How important is homeownership to you?
page
54

But vastly over-estimate downpayment
4% 4%
19%
33%
40%
0%
10%
20%
30%
40%
Percent
n: 1681
How much downpayment is required to purchase a home?
page
55

Most renters would buy with little down
69%
31%
0%
20%
40%
60%
Percent
n: 1716
If you could qualify for a mortgage with a much lower down-payment would you buy?
page
56

Only 30% know of low-down loans
28%
72%
0%
20%
40%
60%
Percent
n: 1716
Are you aware of (FHA) backed loans that require only a 3.5% downpayment
page
57

Membership gains outstripping sales
page
59
0
50,000
100,000
150,000
200,000
250,000
0
100,000
200,000
300,000
400,000
500,000
600,000
1971
1973
1975
1977
1979
1981
1983
1985
1987
1989
1991
1993
1995
1997
1999
2001
2003
2005
2007
2009
2011
2013
2015
2017
Home Sales Membership
Sales Peaks: 1978, 1988, 2004-05
Membership Peaks: 1980, 1990, 2006
HomeSales
Membership

Member productivity has started declining
page
60
1972 Peak:
10.4
2007 Trough:
2.8
2017: 4.2
2018: 3.9
0
2
4
6
8
10
12
1971
1972
1973
1974
1975
1976
1977
1978
1979
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019p
NumberofTransactions
Long Run Average: 6.5

… drop in average earning triggers drop in membership
page
61
$0
$10,000
$20,000
$30,000
$40,000
$50,000
$60,000
0
50,000
100,000
150,000
200,000
250,000
1971
1973
1975
1977
1979
1981
1983
1985
1987
1989
1991
1993
1995
1997
1999
2001
2003
2005
2007
2009
2011
2013
2015
2017
Membership Avg. Member Earning
Earnings Peaks: 1978, 1988, 2004-05
Membership Peaks: 1980, 1990, 2006

Your Competition:
You yesterday and every agent
working harder than you do.
Don’t let them.

U.S. economic outlook
SERIES: U.S. Economic Outlook
2015 2016 2017 2018 2019f
US GDP 2.6% 1.6% 2.3% 2.9% 2.4%
Nonfarm Job Growth 2.1% 1.8% 1.4% 1.6% 1.5%
Unemployment 5.3% 4.9% 4.4% 3.9% 3.7%
CPI 0.1% 1.4% 2.0% 2.4% 2.0%
Real Disposable Income, % Change 3.4% 2.7% 2.1% 2.9% 2.4%
30-Yr FRM 3.9% 3.6% 4.0% 4.5% 4.0%
page
64

California housing market outlook
2015 2016 2017 2018 2019p
2019p
(revised)
SFH Resales (000s) 409.4 417.7 424.9 402.8 375.1 385.5
% Change 7.0% 2.0% 1.7% -5.2% -6.9% -4.3%
Median Price ($000s) $476.3 $502.3 $537.9 $570.0 $568.8 $593.0
% Change 6.6% 5.4% 7.1% 6.0% -0.2% 4.0%
Housing Affordability
Index
31% 31% 29% 28% 32% 32%
30-Yr FRM 3.9% 3.6% 4.0% 4.5% 4.4% 4.0%
SERIES: CA Housing Market Outlook
page
65

Key takeaways
• Low rates help sales but is the momentum is sustainable
• Price set new high but growth will remain soft to modest
• Uncertainties put downward pressure on rates; possible rate cuts in H219
• Many want to buy but affordability remains an issue
• Market remains competitive, productivity/earning likely to decline
page
66

Where is the market data?
page
67

Housing
Matters
Podcast
page
69

Thank You
This presentation can be found on
www.car.org/marketdata
Speeches & Presentations
lesliea@car.org

2019 Mid-Year Market Forecast

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