Here’s a prediction for the Riverside and San Bernardino housing market in 2016. Strong job growth over the last year or so will bring more home buyers into the real estate market, and this in turn will boost local home prices during 2016.
And that’s not just me talking. This is the general consensus among a number of housing analysts and economists. The most recent forecast for this area came from Lawrence Yun, chief economist for the National Association of Realtors, who cited the area’s strong job growth.
Job Gains Bring More Home Buyers Into the Market
In a January 7 article for Forbes.com, Mr. Yun pointed out that Riverside, California has experienced significant job growth over the last 12 months, and that such growth often paves the way for real estate market gains.
After all, a strong job market puts more people in a position to buy (and afford) a home. And that’s the trend we are seeing across much of Southern California at the start of 2016, but particularly within the Inland Empire that includes Riverside and San Bernardino.
According to Mr. Yun, “the candidates that are among the top performers in regards to both rising home sales and home prices will generally be out West … Riverside [California] will likely experience a good year.”
The nation as a whole has experienced some job growth over the last year — about 1.9% from November 2014 to November 2015. But some metro areas have exceeded the national average. Riverside is one of them, having posted a 3.5% rate of job growth during the same 12-month period. This and other trends could boost the Riverside and San Bernardino housing markets in 2016.
Riverside Home Price Forecast: Another Good Year in 2016?
According to the real estate information service Zillow, home prices in Riverside, California rose by 5.7% over the last 12 months or so (as of January 2016). Their forward-looking prediction calls for another 5.6% increase over the next 12 months.
In this regard, the Riverside housing market seems to have bucked the national forecast for price cooling.
The general consensus among economists is that home prices nationwide will rise more slowly in 2016, compared to last year. But Riverside and other high-performing California real estate markets could be an exception to the rule. Such markets could easily outperform most other metro areas in 2016, in terms of home prices and sales gains.
San Bernardino Housing Market Also Looks Strong
Zillow offered a similarly strong prediction for the nearby San Bernardino housing market. By their estimation, home prices in and around the city will rise by around 6.7% in 2016. (This is based on their proprietary “Zestimate” method for measuring house values.) That’s much higher than the forecasts that are being offered at the national level — another testament to the rapid growth of the Inland Empire real estate market.
Here again, job gains play an important role. According to the State of California Employment Development Department, the Riverside-San Bernardino-Ontario metro area gained more than 46,000 jobs during the 12-month period from November 2014 to November 2015. This sets the stage for more gainfully employed home buyers in 2016. Increased housing demand should put upward pressure on home prices, especially if it grows faster than supply (which is entirely possible).
Disclaimer: This story includes third-party predictions and forecasts from individuals not associated with the Home Buying Institute. The publishers of this website make no assertions or claims about the Riverside or San Bernardino housing markets in 2016.