Sanity Returning to California Home Prices?

Sanity, of course, is a relative term and, when dealing with California home prices, sanity is not one that immediately comes to mind. According to a recent article by Kathleen Pender in the San Francisco Chronicle “Home prices getting slightly less insane” in that they only rose by 10.8 percent in a 20-city index in April. Meantime, the rate of appreciation continues to decline as it has every month since November, 2013. In March, the rate was 12.5 percent year over year. Some experts predict that by the close 0lose of 2014 year over year increases will be in the 4 to 7 percent range.

Asking prices rose by 8 percent in May, the least amount of increase in 13 months. Trulia Chief Economist Jed Kolko reported that “…there has been a clear slowdown in price gains. That is a good thing. That is happening even before we have gotten back to a housing bubble.”

Many realtors in San Francisco saw little evidence of a slowdown in the spring with 29 percent of all sales selling for 20 percent or more over the asking price.

June is typically a fairly slow month in sales and many realtors report a rise in inventory.

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