The California association of realtors has just release the forecast for next year. They are forecasting a median price drop of 6% and a sales increase of 12.5%. How do they calculate these estimates? I'm beginning to think they just pull numbers from a hat.
How did they do last year at estimating this years numbers. Well, you could have asked you cat and probably have gotten a better estimate. Last year they estimated that prices would fall 4% and sales would fall 9%. At the current rate it looks like the median sales price will drop about 32% and sales will actually increase about 12%. Thats WAY off. So, why would we think this years estimate is any better?
I doubt we will see another 32% decrease but I also doubt it will be only 6%. 6% in January might be about right, but for the year I would be willing to wager a nice bottle of single malt that the number will be closer to 20%. I'm also skeptical that the sales numbers will increase. I think with the faltering economy and tightening lending standards that the sales numbers will be flat or down slightly. I just cannot see an increase with the economy coming apart like it is. I guess we will have to wait and see who gets closer, me or the CAR.