California housing market sees significant sales rebound

California's housing market is showing strong signs of recovery. In February, home sales hit their highest level in over two years, with 283,540 existing, single-family homes sold on a seasonally adjusted basis. This is an 11.6 percent increase from January and a 2.6 percent rise compared to February 2024. The rebound is largely due to falling mortgage rates and an increase in available homes for sale, according to the California Association of Realtors (CAR). However, overall sales have stayed below 300,000 since September 2022, and uncertainty in the market may keep home sales soft for the coming months. While sales are up statewide, the performance varies by region. The San Francisco Bay Area and Central Coast saw year-over-year sales growth, while the Far North, Central Valley, and Southern California regions experienced slight declines. Many counties reported sales gains, with Calaveras County seeing a 35.5 percent increase, while Tehama County had the largest drop at 43.5 percent. In Los Angeles County, the number of available homes for sale rose by 32 percent compared to February 2024. Homes sold in an average of 26 days, which is longer than last year’s average of 22 days. The statewide median home price is now $829,060, reflecting a minor monthly drop but a 2.8 percent increase from last year. Despite the positive trends, February's price increase was the smallest in nearly a year, suggesting a cooling off in price growth may be ahead. Economists expect mortgage rates to stabilize later this year, which could further support market growth. While homeowners may benefit from improved conditions, renters in Southern California are facing challenges due to wildfires that destroyed thousands of homes. Many displaced residents are now competing for rental units, which may drive rents up, especially for larger homes near affected areas. Experts believe that while the rebound is encouraging, growth may not continue at the same pace. Predictions indicate only slight increases in home prices over the next year in major regions like Los Angeles and Orange counties.