California – The Recession’s in the Rear-View Mirror
In 2006 – when California was enjoying the fruits of a housing boom – nearly 14 million Golden State residents had a job. Four years later, more than 1.3 million of those people were out of work. As you can imagine, buying new homes wasn’t at the forefront of people’s minds. Heck, paying for the homes they had was enough of a struggle!
Adding to California’s housing problems back then? The construction industry was absolutely gutted. In fact, nearly half of the construction jobs in California were eliminated in 2010, so even the people who wanted to buy new homes didn’t have a whole lot to choose from!
But times are starting to change.
While the Golden State’s housing market isn’t anywhere near as prosperous as it was during the boom days, it is back on the right track. And, the closer you get to the beach, the better things are.
Take San Diego, for example. Median sales prices there jumped almost 20% during 2012, and realtors around California say they expect additional gains in 2013.
One of the biggest changes the San Diego market has seen has been a significant decrease in the number of distressed homes. Even at the beginning of 2012, foreclosures and short sales made up a large chunk of the market. But as 2012 came to a close, buyers were opting for more luxury homes – with higher price tags than the foreclosures that are sold at bottom-basement prices.
In Orange County (where Los Angeles is located), all-out bidding wars became big news at the end of 2012. In fact, bidding wars over the homes for sale there became so common that they actually caused the median sales price to jump 12% by year’s end. Realtors in California were blown away by the demand and proclaimed that December 2012 broke local sales records!
Homeowners who were on the fence before couldn’t help but take notice, so expect more homes for sale to pop up around the Los Angeles metro in 2013.
Further to the north, San Francisco has always had the reputation of being a “tough” housing market. With sky-high prices, buying here has always been difficult (which is why places like Oakland and San Jose are so appealing to buyers). But an influx of new jobs in 2012 led to new life for San Francisco’s housing market. The homes for sale here got snapped up by new additions to San Francisco’s ever-growing tech industry – and sellers loved it!
Since there’s every indication that those tech companies are going to keep expanding in 2013, look for realtors in San Francisco to stay busy.
The only problem?
Even after the recession, California is still one of the most expensive places to call home. So, it’s going to take you awhile to save up. In the meantime, you’re going to have to find affordable apartments to rent while you get your down payment squared away.