What Will California Housing Look Like in 2027?
California Housing: What to Expect in 2027 ONE MINUTE in REAL ESTATE Home Sales - The California Association of REALTOR®’s “2027 California Housing Market Forecast” sees an increase in existing single-family home sales of 3.7 percent next year to reach 277,900 units, up from the projected 2026 annual sales figure of 268,100. The projected 2026 figure is 1.1 percent lower compared with the pace of 271,100 homes sold in 2025. Pricing - The California median home price is expected to edge up 1.4 percent to $894,400 in 2027, following a projected 0.8 percent increase to $882,200 in 2026 from $875,600 in 2025. A continual shortage of homes for sale will remain a defining factor. That imbalance between supply and demand should provide upward support for home prices while limiting the pace of overall market growth. Economy - C.A.R.’s 2027 forecast predicts U.S. gross domestic product (GDP) growth rate to improve by 2.2 percent in 2027, after a projected increase of 2.0 percent in 2026. With the state’s nonfarm job growth projected to remain at 0.3 percent in both 2026 and 2027, California’s unemployment rate is expected to dip to 5.4 percent in 2027 from 5.5 percent in 2026. Inflation will remain elevated in the coming months, and the Consumer Price Index (CPI) for 2026 will inch up slightly to 3.4 percent, before decreasing to an annual average of 2.4 percent next year. The average 30-year, fixed mortgage interest rate will remain at 6.6% in 2027 for the third straight year. The C.A.R. forecast was published before the midterm election results where two bills encourage growth and affordability. These include Proposition 1, which “Authorizes Bonds for Housing Affordability”; and Prop 37 which “Creates Loan Program for Middle-Income Buyers”. While the impact from these bills is yet to be measured, it will likely enable more construction and an increase in sales. San Mateo County and particularly Burlingame typically fare significantly higher for price appreciation than the broader California market, and recent expansion of income from AI has already began to impact demand and increase prices. Let me know your thought. Call 650-627-3791, or text 415-509-2326.