NEW YORK (MainStreet) -- The U.S. housing market has been bouncing along at the bottom for four years now, but there are some slow, steady signs that the worst may indeed be over. At least that’s this week’s outlook, and it’s based on new data from the most populous state in the U.S. – California.
According to a report from the California Building Industry Association, Californians were able to afford a higher percentage of homes sold in the third quarter of this year as housing affordability increased in 22 of the state’s 28 metropolitan areas included in the report.
The CBIA says that in the third quarter of 2011, statewide residents earning a “median” income could afford to buy 63.5% of the new and existing homes that are for sale in California, up from 61.3% in the second quarter.
In layman’s terms, the CBIA is telling potential homebuyers that right now is a great time to buy a new home in California.
“As builders continue to compete with a glut of foreclosures and as housing prices continue to find their footing, this remains an opportune time for prospective home buyers,” said Mike Winn, CBIA’s president and CEO, in a press release. “We hope that record-low interest rates coupled with these historically high affordability levels will coax buyers off of the sidelines. We can then continue to clear the unsold inventory and help get job-generating home construction back to healthy levels.”
Interest rates certainly are low these days. According to the BankingMyWay Weekly Mortgage Rate tracker, the average 30-year fixed mortgage loan rate is at 4.13% this week, and adjustable-rate mortgages are even better at 2.76% for a five-year ARM.
The CBIA reports that the San Francisco, San Mateo and Marin County metro area was the least affordable metro area in the state, while Sutter and Yuba counties were California’s most affordable metro area with 89.3% affordability.
Luxury homes in the Golden State are also showing promise. Buying activity for homes worth $3 million or more is up in California, according to Beverly Hills-based Westside Estate Agency, a high-end real estate firm.
The WEA says that high-end homes in Malibu and Pacific Palisades are “selling faster” in the third quarter of 2011.
“There is no question that the homes in these two areas continue to sell regardless of what’s happening in the rest of the world,” notes Bill Kerbox, a WEA agent based in Malibu and lead author of the study. “The telling change is the number of days these homes are on the market, which is shorter this year. This indicates that buyers are in a serious shopping mode and homes that are priced correctly are selling faster.”
Whether it’s median-level housing in Fresno or upscale digs in Malibu, there’s growing activity – and opportunity – in the California housing market right now. The rest if the country can only hope that trend drifts eastward – and soon.
California has long been at the forefront of the housing crisis and recovery. Check out MainStreet's look at why in California: Where Housing Will Rebound!