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CAR expects house prices to decrease

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The California Association of Realtors announced Wednesday its housing market forecast for 2007, saying that home price appreciation will decline modestly next year and sales pace will decrease.

In a press release, the association described the figures as a sign that the market is stabilizing after several years of increases.

The group predicted that the median home price in California will decrease 2 percent next year to $550,000. It also said that sales will decrease 7 percent to 447,500 units. That’s compared to the projected figures in 2006 of 481,200 units.

The associations vice president and chief economist, Leslie Appleton Young said in the release that San Diego should expect greater declines than other areas of the state.

“Looking to 2007, we expect that some regions of the state, including the Central Valley, San Diego and Riverside/San Bernardino regions, will experience sales declines greater than the state as a whole,” she said. “That also holds true for several second-home markets, including the desert areas of Southern California and the Wine Country.”

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