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The Hottest Real Estate Markets in California for the Next Five Years

myrealtornews
Sep 29, 2016
2 min read

The Hottest Real Estate Markets in California for the Next Five Years Nationally, inventory is 9% lower than a year ago, according to Money.com and all but four of the 35 largest markets tracked by Zillow now have fewer homes for sale than at the same time last year.

The tight market is driving up prices. Home values rose 5.7% in 2015, according to the closely watched Case-Shiller 20-city index. Most economists think prices will keep climbing, at least in the short term: The NAR is calling for a 4.4% increase in existing-home prices this year and 3.4% in 2017; other economists and strategists also put 2016 price growth in the 4% to 5% range. So how will prices fare over the next half-decade for the top four biggest metros in California (Los Angeles, Anaheim, San Diego, and Riverside)? The economists at Moody’s Analytics gave MONEY.com their home price projections to the year 2020 as follows:

Los Angeles, CA After a construction decline, demand is still outpacing supply in Los Angeles, pushing prices upward for the next few years, Moody's Analytics finds.

Anaheim, CA Anaheim's housing market looks overpriced now because of weaker income growth in the area, Moody's Analytics suggests, so home prices are expected to grow more slowly over the next few years than in other Southern California cities

Riverside, CA Riverside's local economy is tied up with housing-related industries like construction and mortgage lending, so its growth is expected to track nationwide housing market trends, Moody's Analytics finds.

San Diego, CA The San Diego 2016 growth forecast is solid, says Andres Carbacho-Burgos, a senior economist at Moody’s Analytics, although he notes that income growth “isn’t as strong as it once was.”