With the Pebble Beach Concours d’Elegance kicking off this weekend, we have already started to daydream about rare vintage Mercedes and brand-new-never-seen-before Porsches being unveiled against the backdrop of the 18th fairway at Pebble Beach.  The Concours is easily one of Northern California’s (and world’s) most anticipated luxury events, attracting the likes of Jerry Seinfeld, Jay Leno and other celebrities who can’t wait to get a glimpse of the ultra-luxury cars from the past, present, and  future on display. Eye candy? Yes. An analogy for the housing market? Possibly. Let’s examine.

 

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Image courtesy of: edmunds.com

The automobile—and more specifically, racing—seem fitting comparisons for what’s happening in many California real estate markets right now. If you live in a hot area like San Francisco or Los Angeles, buying your dream home is like a race to the finish line. If you’re a buyer, you need to move quickly. If you’re a seller, you need to make sure your home is in optimum condition to get the highest possible sale price. Competition is fierce. Only the fastest and the best prepared win. Take, for example, the National Association of REALTORS’ (NAR) recent quarterly report. Noted Lawrence Yun, NAR chief economist: “Areas with tighter supplies generally are seeing the strongest price growth, including markets such as Sacramento, Atlanta, Las Vegas, Naples, San Francisco and Los Angeles.” Three out of the six metro markets he mentioned were in California. In San Francisco, especially, the race is tight. The supply of homes available for sale is down 80% from its peak in 2008. It’s also an area with a strong job market; San Francisco’s unemployment rate was 6.5% in June. Coupled with that, prices in San Francisco were up 24.5% over the year in May, according to the S&P/Case-Shiller Home Price Index. Plus, some experts are expecting 12.7% price appreciation over the next year. In San Francisco, all cylinders are firing. It’s pedal to the medal from start to finish.

For more on what California homebuyers and sellers expect as they jump into the race this year, take a look at the latest real estate headlines below….

Did you know that almost 90% of U.S. markets are expected to experience price appreciation over the next year? MarketWatch examines. 

Mortgage delinquencies fell to a five-year low during the second quarter, says The Wall Street Journal

Zoom zoom… prices for single-family homes climbed in 87% of U.S. cities in the second quarter as the national housing recovery accelerated. The driving force? Low inventory, says Bloomberg.  

Even in the Bay Area’s hardest-hit areas, the boom is back. Or says San Jose Mercury News.

Slow and steady win the race. According to the Los Angeles Times, some real estate experts advise buyers to “be patient” and “keep trying” in this overheated housing market.

Luxury homes priced at more than $1 million are on fire—gaining at triple the pace of the broader market, reports Bloomberg

Think that Americans will be deterred by rising mortgage rates? Think again, says Fannie Mae

If you’re wondering what the impact of Fannie and Freddie’s closing could have on mortgage rates and the broader housing market, click here

What’s your assessment of the real estate market in California? Is it on the fast track to recovery?

Lead image courtesy of: autoweek.com