Is California Real Estate Turning a Corner?
Smart Money
By Lisa Scherzer
...ONE OF THE NOTEWORTHY characteristics of California's housing market is that it fell early and it fell hard - crowning the state as a leading indicator of the crash that was to come. Given last week's housing news, could California now be leading the nation out of its real estate woes?...
Indeed, the first-time home buyer tax credit - soon to expire - has been one major driver of the activity...
... The tax credits might draw out a few more buyers, but what's really going to drive price increases here - as well as in the rest of the country - is economic fundamentals. That means jobs, people's income and population growth, says Gary Painter, a professor and director of research at the University of Southern California's Lusk Center for Real Estate. As of February, California's unemployment rate was 12.5%, while the national rate for March remained at 9.7%.
"You're definitely seeing not a lot of days on the market and not a lot of inventory - so that's encouraging," says Painter. "But it's going to take a while before there's enough job growth and income growth that will stabilize and increase housing demand."...