The coronavirus (COVID-19) outbreak has affected a number of industries in an immeasurable manner. For most segments, the harm can be seen from a mile away. However, the same cannot be said for the real estate sector, which is soaring through various aspects.
Take the California housing market, for instance. Not only has the region recorded tremendous interest by new homebuyers, but also noticed significant increase in overall home prices. According to reports from the California Association of Realtors, annual home prices were up by 17 percent in October 2020. But that’s just the tip of the iceberg for the state as well as corresponding homebuyers and sellers alike.
Shift in Priorities Triggers an Upwards Tick in Market Movements
Due to the circumstances that have risen from COVID-19, Californians are finding themselves in the middle of an unprecedented situation. In addition to complying with shelter-at-home orders, they also need to take care of their mental and physical well-being.
As a result, the need to move to bigger homes has taken priority for those who can afford it. This has caused various existing homeowners to put their California homes for sale. For some, it is a way to find a larger property in the same area. For others, it is the first step towards moving to a suburban lifestyle.
On the other hand, the all-time low mortgage rates have caused aspiring homebuyers to finally realize their real estate dreams. Even with high prices, the lower interest rates allow future homeowners to afford their ideal listings in the Golden State.
This phenomenon started at the start of the COVID-19 outbreak in California. But it has continued consistently since then. While home prices have increased, sales have also followed their upwards trajectory. Demand also follows the same trend, with homes selling within 10 days of being put on the market.
Sales Have Increased Right Along With the Price
When put together, this seller activity and buyer interest makes for the perfect recipe for the California housing market. In October 2020, California condos and townhomes saw a 24.5 percent increase in sales as compared to October 2019. This particular movement was also evident on a regional basis.
For instance, the Los Angeles Metropolitan Area saw its annual sales increasing by 16.8 percent. It did so with a price hike from $545,000 in October 2019 to over $632,700 in October 2020. This marked a staggering increase in sales despite a yearly price hike of 16.1 percent.
In October 2020, the San Francisco Bay Area noticed an annual increase in home sales by 18.9 percent. As compared to the same time last year, home prices also increased by 17 percent. This took the median home price in the area from $940,000 to $1.1 million.
But the biggest price change was seen in the Central Coast with a whopping yearly increase of 25.9 percent. The annual California homes for sale figures in the area matched this scale and increased by 28 percent. This took the region’s median home prices from $675,000 in October 2019 to $850,000 in October 2020.
These movements and trends have continued towards the end of the year. It is safe to say that the California market may come out on top in terms of annual performance.
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