02 Jan California Real Estate; the year in review
Home prices in California doubled the national average in 2021. The most significant increases were in the suburbs and smaller metro areas.
Sacramento and Riverside were two of California’s most in demand cities with a 22.3% price increase over 2020. In both cities there are bigger homes with relatively affordable prices. In Sacramento, for example, the median home price was $472,000 (statistics from Zillow)
According to the California Department of Finanmce, the median sales price of a single-family home in California was $798,440 up 12.3% from 2020 and more than twice the national average of $353,900 (reported by the National Association of Realtors)
Jeff Tucker, a senior economist with Zillow, remarks, “The bay Area’s housing market was one of the state’s coolest in 2021 with home values rising sharply but at a lower rate than statewide values. By Zillow’s calculations, the city of San Francisco saw the typical home value increase by 9.3% to $1.53 million from November 2020 to November 2021, compared to a statewide increase of 20%.
Furthermore, Tucker explains, “It’s like a fractal. You zoom in and the pattern reasserts itself with the national trend of more affordable outlying areas seeing the most significant price growth.”
So what’s in store in 2022?
According to Danielle Hale, chief economist at Realtor.com, “A lot of those California markets are going to see home price grow half as fast as they did in 2021. That should be a relief for buyers.”
She cautioned that, “The slow pace of construction meant that demand for homes would likely outstrip supply in much of the sate for the foreseeable future.”