March 22, 2018

Risk of Bubble for California Housing Markets Is Minimal, Report Says

San Francisco and Los Angeles market conditions do not indicate a looming bubble.

  • Analysts at Arch MI do not believe that home prices are overvalued, nor do they foresee a looming bubble.
  • The chances of home prices declining in California over the next two years is 3 percent, making it a minimal-risk market.
  • All 12 California metropolitan areas that the report tracks have minimal risk of price depreciation by the end of the decade.

 

Although home prices should continue to increase for the rest of the decade, a bubble does not appear imminent nationwide, in California, or in the Bay Area.

That’s according to Arch MI’s latest Housing and Mortgage Market Review report, in which company analysts wrote “Home prices in the U.S. currently do not appear to be overvalued based on the historical relationship between home prices and incomes.” Before the housing crisis, U.S. home prices were 22 percent overvalued, then fell to levels that were 12 percent undervalued in 2012. Currently, Arch MI estimates that home prices are now 10 percent to 15 percent undervalued because of mortgage rates that remain near record lows.

To read the full post, click here: http://pacunion.us/2HYmUlY


About The Mark Company

The Mark Company is one of the nation’s premier urban residential marketing and sales firms. Founded by Alan Mark in 1997, The Mark Company provides a full range of core consulting services including analytics, design, marketing and sales for urban high-rises and suburban attached properties throughout the Western United States. The firm is a trusted partner to global leaders in residential development and finance, providing buyer-driven sales and marketing strategies that produce industry-leading results. The Mark Company has represented more than 10,000 residences and generated over $5 billion in sales for some of the nation’s most notable and successful developments including The Infinity in San Francisco, Evo in Los Angeles and The Martin in Las Vegas. Current projects include 181 Fremont Residences and The Austin in San Francisco and Cavalleri in Malibu. The Mark Company is a subsidiary of San Francisco-based Pacific Union International, the eighth-largest residential real estate brokerage in the U.S. based on 2016 sales volume of $10.15 billion. Pacific Union merged with Los Angeles-based brokerages John Aaroe Group in December 2016 and Partners Trust in August 2017. This strategic business collaboration links four of the strongest residential real estate firms on the West Coast, supporting combined 2016 production of $12.6 billion by 1,400 real estate professionals in 47 offices throughout California. For more information, please visit www.themarkcompany.com.