Home sales in California, the most populous U.S. state, are likely to rise 1 percent in 2012 after being â€œessentially flatâ€ this year, the California Association of Realtors forecast today.
Sales of existing homes are expected to rise to 496,200 units from a projected 491,100 in 2011 and 491,500 last year, the Los Angeles-based group said in a statement. Median prices probably will rise 1.7 percent to $296,000 from $291,000 this year, according to the Realtors.
â€œThe fundamentals of the housing market -- such as lowmortgage rates, high housing affordability and favorable home prices -- are expected to continue,â€ Beth L. Peerce, president of the California association, said in the statement. â€œBut at this point, a strong housing recovery will depend on consumer confidence, job creation and the availability and cost of home loans.â€
California home sales, which account for about a 10th of the U.S. total, have fallen from 625,000 in 2005, while median prices are down from a peak of $560,300 in 2007, according to the group. The state ranks second nationally, after Nevada, in the pace of foreclosure filings. One of every 226 homes received a notice of default or was subject to a foreclosure sale in August, RealtyTrac Inc. reported Sept. 15.
It will take as long as five years for the stateâ€™s inventory of foreclosed properties to be absorbed, Leslie Appleton-Young, chief economist for the California Association of Realtors, said in a conference call today.
â€œIt depends on the area,â€ Appleton-Young said. It will beâ€œcloser to five in the inland areas, where I donâ€™t think weâ€™ve seen a lot of the supply thatâ€™s going to come through come through,â€ she said.
The California Realtorsâ€™ forecast for this year was lowered from 505,000 sales projected in June and 502,000 in October.