2019 is in the rearview mirror, and for most of us Butte County Residents, the sentiment is good riddance! After the devastating Camp Fire, 2019 was quite a roller coaster ride as our communities struggled to adjust to dramatic population changes. When looking at Real Estate Market stats, the graphs are generally lines that have little bumps and waves, with an obvious trajectory, but that was NOT the case with 2019. In weeks and months following the fire, prices in Chico literally skyrocketed. The average sales price in Chico shot up 20% between November 2018 and March 2019. By summer, the market began falling almost as quickly as it had spiked. Inventory climbed during the spring as both investors and homeowners recognized the opportunity to sell at a premium and for months it seemed there were more price reductions then new listings! Then suddenly, at the end of 2019, inventory plummeted, again putting upward pressure on prices. With all of the crazy ups and downs behind us, we ended 2019 with average prices up approximately 11% over 2018.
It seems that a lot of residents who were contemplating leaving the area eventually, took advantage of the sellers market and sold in 2019, resulting in a 5% increase in the number of homes sold over the prior year. I don’t think we will see the same volume of transactions this year. With fewer homes hitting the market, inventory will likely remain low, keeping pressure on prices. The Chief Economist at the California Association of Realtors is forecasting a 2.5% increase in California’s median home prices. Our market should follow suit.
Clearly, with low inventory and incredibly low days on the market, 2020 looks to be another sellers market, BUT that does not mean it's a bad time to buy. Interest rates for a 30 year fixed mortgage are at about 3.75%, and rents just continue to increase. If you want to discuss homeownership or investing in Real Estate... We would LOVE to connect with you!