Today’s Housing Market in California’s Central Valley
As predicted 2017 brings an increase in pricing for resale homes. This is the direct result of supply and demand. There are more buyers entering the market and fewer homes to choose from, especially in the starter home price range. During the housing market crisis of the fall of 2008 new construction of housing came to a crushing halt. Home builders over the last couple of years have just begun to build again. As population continues to rise and Millennials are entering into the market, it is creating higher demand. Low supply is not only driving up home prices but also in the rental market as well. Rent amounts have been on a steady increase in recent years as well due to low supply. Renters are forced to pay 30 to 40% more in rent than just a few years prior.
Although new home construction is now underway, builders are increasingly building less and less starter homes. This has resulted in high demand for starter homes and increased pricing, for they tend to get multiple offers once those homes hit the market. This has made it increasingly difficult for first time home buyers and folks that are looking to downsize find their home.
With that being said, many Millennials are skipping from the traditional starter home and buying a larger more expensive home. Due to low interest rates, a home that increases by $100,000 could only mean an extra $600 onto their monthly payment.
With a strong housing market well underway for 2017, I don’t see it slowing down anytime soon. Until supply is greater than the demand, we will continue to see an increase in rents as well as a possible increase in home prices. This means the housing market is looking very promising for 2018.
For more information or questions, feel free to contact Janet Anderson at 209-321-5981 or email her at firstname.lastname@example.org