This is the second in a two-part series that explains how to buy a home…
Last month, we offered a home buying guide for those who are planning to move to the San Francisco Bay Area in 2024. Today, we zoom out to look at the state as a whole, with a real estate market overview for people relocating and moving into California in 2024.
Moving to California in 2024: A Real Estate Guide
By some measurements, California is the most expensive real estate market in the country. We also have some of the tightest housing market inventory conditions, especially here in the San Francisco Bay Area region.
But the California real estate market is currently undergoing some changes that could affect home buyers in 2024. Here are four things you need to know before entering the real estate market:
1. Southern California has some of the hottest markets in 2024.
California is known for having a highly competitive real estate market, largely due to an imbalance between supply and demand. During a typical year, there are more home buyers in the market than there are properties available. This increases competition and puts upward pressure on home prices.
In 2024, the Southern California region in particular has the hottest real estate market. We covered some of the reasons for this in a previous report.
The short version is that Southern California has a more extreme version of the supply-and-demand imbalance mentioned above. There are plenty of buyers in the market seeking properties, but not nearly enough inventory to satisfy that demand.
Because of this, Southern California markets like San Diego, Orange County and Riverside will probably see some of the biggest home price gains of 2024.
A couple of months ago, Realtor.com published a forecast that ranked what they believe will be the hottest markets of 2024. Here’s a relevant quote from that report:
Five California metros entered our top 10 list of housing markets but none were Bay Area or Northern Californian metros. The top five Californian metros include Oxnard, San Diego, Riverside, Bakersfield and Los Angeles. These five metros are expected to have sales growth of 13.1%, on average, in 2024, compared to an average decline of 4.1% for other Californian metros in the largest 100 list.
Parts of the San Francisco Bay Area have highly competitive housing markets as well. The East Bay counties of Contra Costa and Alameda, for example, currently have some of the lowest supply levels in the state.
And speaking of inventory…
2. Low inventory might be a challenge when buying a home.
If you plan to buy a home after moving to California in 2024, you could encounter tight inventory conditions. Overall, the state continues to experience a relative supply shortage.
One way to measure housing market inventory is through a metric known as the “months of supply.” This metric essentially tells you how long it would take to sell all the current homes on the market at the current sales pace. It also helps us understand the balance between buyers and sellers in a particular market.
When this report was published, in February 2024, the state of California had about a 2.5-month supply of homes for sale. That’s an improvement from the record-low 1-month supply level that occurred during the COVID-era real estate boom. But it’s still well below historical averages.
The San Jose metro area, which includes “Silicon Valley,” currently has the lowest inventory among California’s major real estate markets. The Napa Valley region has one of the highest levels of supply, along with Mendocino.
Regardless of what part of California you’re moving to in 2024, low inventory could be one of the biggest challenges you encounter as a home buyer.
3. Expect higher-than-average home prices.
As you probably already know, California is the most expensive state in the country when it comes to home prices. No surprise there.
In February 2024, the real estate data company Zillow wrote that: “The average California home value is $743,435, up 3.3% over the past year.”
That’s the statewide average. When you drill down to individual cities and counties, home prices can vary widely depending on where you want to buy a home.
According to the California Association of Realtors, the median home price in San Mateo County was around $1,800,000 at the start of 2024. But in much of the Central Valley region, the median price point ranges from $300,000 to $400,000. So we’re talking about a very broad spectrum.
Here are the median sale prices by region, as of January 2024:
- Los Angeles Metro Area $760,000
- Central Coast $979,500
- Central Valley $462,000
- Far North $364,500
- Inland Empire $570,000
- San Francisco Bay Area $1,182,000
- Southern California $790,000
House values in California rose to an all-time record high back in the fall of 2022, and then declined a bit as the real estate market cooled. But now, in the early weeks of 2024, California home prices have begun to creep upward again.
This is an important consideration for those who are planning to move to California in 2024 (and buy a home soon after arriving). Given the current trend of rising prices, it might make sense to purchase sooner rather than later.
But again, all of this can vary from one city to the next. So you’ll want to do plenty of local real estate research before entering the market.
4. We can help you finance your home purchase.
Bridgepoint Funding goes above and beyond to educate and assist home buyers in California. In fact, this article is just one of hundreds that we’ve published over the years.
But we’re not just a home buyer educator and advocate. We also offer a wide range of mortgage loan options for all types of borrowers. We partner with multiple lenders instead of just one. This enables us to find the ideal financing option for each individual client.
Please contact our staff if you need help financing a home purchase after moving to California in 2024!