As a leading Certified Residential Real Estate Appraiser in California’s Inland Empire, Hosking Appraisal Group spends a great deal of time researching trends and predictions in southern California’s housing market. We believe that knowing and tracking price and buying trends in the areas where we work is paramount to keeping our thumb on the pulse of the housing market. We research and share resources that can help us, our clients — and other visitors to our site — make more confident and healthier decisions when considering real estate options and opportunities.
Recent Housing Market Trends
Unless you’ve been residing under a rock, you’re well aware that we’ve experienced astronomical growth in real estate values the past few years. Our tracking of the Inland Empire housing market in this blogpost from 2017 shows just how much the region’s home values have exploded in a five-year period. The average home price in Canyon Lake in 2017 was $374,000. Redfin recently reported that in June 2022, the average home price was nearly $620,000, a 60% increase in value! Proof that we’ve been experiencing a sizzling hot market with record low interest rates and record high home prices. Market inventory has also been historically depleted, causing a bevy of bidding wars that have driven home prices skyward.
Change is in the air …
As we navigated the first half of 2022, inflation arrived (as predicted) and the mortgage rate jumped from 3.22% in January to 5.57% in August. Market inventory is also growing and fewer people are actively shopping for a new home. One of many reasons is that elevated home prices combined with higher interest rates (and record-high gas prices, especially painful for commuters) have made home buying downright unaffordable for many SoCal residents.
Homes are also staying on the market longer, which means fewer bidding wars and signs of a decline in urgency to buy. This recent article in the LA Times reports that nearly 30% of homes in the Los Angeles/Orange County market had price cuts in June of 2022. In the Inland Empire, nearly 19% more homes were on the market in June 2022 compared with the same period the year prior. Homes are staying on the market longer and month-to-month inventory continues to expand.
An Indefinite Future, at Least for Now
Whether these new housing market trends indicate that home values will decline or simply that the rate of home appreciation will slow remains to be seen. But keep in mind there is still a shortage of housing in Southern California and a lot of buyers who are actively in the market to purchase a home. There is no cut and dry answer as to what the future holds, but we’ll continue to track this increase in supply and decrease in demand, as well as home value trends in the ever-changing southern California real estate market.
HOSKING APPRAISAL GROUP
22860 Compass Dr
Canyon Lake, CA. 92587
Phone: (951) 294-1955