Some Good Mid-Year News About The 2014 California Housing Market

A mid-year survey by the California Association of Realtors shows there are plenty of reasons to feel good about the housing market heading into the second half of the year. According to the survey, buyer optimism regarding home prices continues to improve, with the vast majority of buyers (81 percent) believing that home prices will rise in five years and 60 percent believing that prices will rise in one year. Higher down payments are still the norm in this market, with buyers putting an average of 28 percent down on their purchases.

In a sign of recent market competitiveness, more than nine in 10 buyers (91 percent) made one or more other offers, with an average of 3.6 offers in 2014, up from three offers in 2013. Additionally, buyers viewed a median of 20 homes in 2014, up from 10 last year. Not all the news is great, however. Given the limited supply of homes available for sale, fewer buyers were satisfied with their home purchase than last year. Only about half of the buyers were satisfied with their purchase in 2014, down from two-thirds (66 percent) in 2013. Roughly half (46 percent) felt "settled" with their their home purchase in 2014, up from 34 percent.

Loan officers and real estate agents should be pleased with the survey's findings that nearly all surveyed buyers (88 percent) still used a real estate agent in the first part of 2014 (though down slightly from 91 percent in 2013). More than nine in 10 buyers (92 percent) obtained a fixed-rate loan, a 23 percent increase from 2009, when only 69 percent obtained a fixed-rate loan, reflecting low rates and the desire for certainty as the market gets back to basics.

The survey also asked questions about social media and found that mobile technology and the Internet continued to be important tools in the home-buying process, with 91 percent saying they used a mobile device to access the Internet during the course of their home purchase. Buyers used their mobile devices to look for comparable home prices (78 percent), search for homes (45 percent), and take photos of neighborhoods, homes, and amenities (43 percent). Conversely, with the increased use of social media, fewer buyers “Googled” their agent (50 percent in 2014, down from 68 percent in 2013), turning to agents’ Facebook pages instead, and nearly two-thirds (65 percent) of those who used an agent found their agent online, compared to only 38 percent who found their agent online in 2003.