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CALIFORNIA HOME SALES EXPECTED TO DECLINE IN 1994, FORECAST SAYS

 ANAHEIM, Calif., Sept. 28 /PRNewswire/ -- Total existing, single- family home sales are expected to decline in 1994 as the state continues to slowly work its way out of the recession, the California Association of REALTORS (C.A.R.) said in a forecast released today.
 Sales of existing, single-family detached homes in California are expected to decrease 2.4 percent next year from a projected 410,000 units in 1993 to 400,000 units in 1994, according to C.A.R.'s 1994 Housing Market Forecast.
 "Many Californians will still find opportunities in next year's housing market, despite the projected decline in total statewide sales for 1994," said C.A.R. President Walt McDonald. "Affordability is at its highest level in many years, mortgage interest rates are lower than they've been in more than two decades and a wide variety of homes are for sale," said McDonald, a Riverside REALTOR. "Entry-level homes continue to sell well because of heavy first-time buyer demand. And, we continue to see an increased share of purchases by non-traditional households," McDonald said.
 The projection of 410,000 total existing sales for this year represents a 4.4 percent decline from the 429,040 sales experienced statewide in 1992. The Association initially projected a slight increase in sales for this year, compared with 1992.
 "The ingredients are in place for improvement in California's overall housing market once we see more jobs created in key economic sectors and an improvement in consumer confidence," said Leslie Appleton-Young, C.A.R.'s vice president of research and economics. Appleton-Young is presenting her 1994 Housing Market Forecast today during a speech at the Association's annual convention, held this year at the Disneyland Hotel in Anaheim, Calif.
 "California's economic rebound is tied to national and global economic developments which have been disappointing so far in this recovery," said Appleton-Young. "Some industries in California, however, are experiencing modest growth or are poised for an improvement in activity, including high-technology, entertainment, tourism, professional services and international trade," Appleton-Young said.
 When preparing the forecast for next year's housing market, C.A.R. economists analyzed key economic data and indicators for the United States and California economies. Here are other elements of the Association's 1994 Housing Market Forecast:
 -- The statewide single-family median home price for 1994 is expected to be $186,000, down 3.1 percent from the revised projection of $192,000 for this year. (The $192,000 figure for this year represents a 3 percent decline from the $197,900 median price registered in 1992.)
 -- The forecast calls for a 2.8 percent expansion in the U.S. Gross Domestic Product (GDP) during 1994, up slightly from a projected 2.7 percent GDP rate for this year. The rate for 1992 was 2.6 percent.
 -- Condominium sales in California are expected to decline 6 percent in 1994, after registering a projected 15 percent decline this year, compared with 1992. The condominium market continues to be affected as more homebuyers opt to purchase favorably-priced, single-family homes in many areas. Condos, however, still represent an affordable option for many first-time homebuyers -- especially those who want to purchase homes in the more expensive areas of urban regions such as Los Angeles and San Francisco.
 -- The statewide median condominium price for 1994 is expected to be $131,100, down 6 percent from the revised projection of $139,500 for this year. (The $139,500 figure for this year represents a 4.3 percent decline from the $145,790 median price registered in 1992.)
 -- Single-family housing permits are expected to total 85,000 next year in California, up 12.7 percent from a projection of 75,400 in 1993. Multi-family permits are expected to reach 21,000 in 1994, up 10.5 percent from a projected 19,000 this year.
 The California Association of REALTORS is a statewide trade association with 115,000 members dedicated to the advancement of professionalism in real estate. C.A.R. is headquartered in Los Angeles.
 1994 FORECAST FACT SHEET
 California Association of REALTORS
 1992 1993 1994
 Actual Projected Forecast
 United States
 Real Gross Domestic
 Product 2.6 pct 2.7 pct 2.8 pct
 Unemployment Rate 7.4 pct 7.0 pct 6.5 pct
 Inflation Rate 3.0 pct 3.2 pct 3.5 pct
 Mortgage Rates
 Fixed 8.4 pct 7.3 pct 7.8 pct
 Adjustable 5.6 pct 4.8 pct 5.1 pct
 California
 Single-Family Resales 429,040 410,000 400,000
 Pct Change 0.9 pct -4.4 pct -2.4 pct
 Condo Sales
 Pct Change -9.3 pct -15.0 pct -6.0 pct
 Median Prices
 Single-Family $197,900 $192,000 $186,000
 Pct Change -1.4 pct -3.0 pct -3.1 pct
 Condo $145,790 $139,500 $131,100
 Pct change -0.1 pct -4.3 pct -6.0 pct
 Permits
 Single-Family 76,200 75,400 85,000
 Pct Change 3.2 pct -1.0 pct 12.7 pct
 Multi-Family 21,200 19,000 21,000
 Pct Change -33.9 pct -10.4 pct 10.5 pct
 SOURCE: California Association of REALTORS, Research and Economics Department, September 1993.
 -0- 9/28/93
 /CONTACT: Jeff Hershberger or Lotus Lou of the California Association of REALTORS, 213-739-8304/


CO: California Association of REALTORS ST: California IN: FIN SU:

MF-LM -- LA006 -- 6339 09/28/93 11:29 EDT
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