Chart Last Updated 8/20/11

	July 2011	June 2011	July 2010
Southern CA	18,090	20,532	18,946
Northern CA	16,605	18,443	16,256
CA Total	34,695	38,975	35,202

Chart Last Updated 8/7/11

	2012*	2011*	2010	2009	2008	2005
NorCal	190,000	189,330	192,979	219,460	191,809	398,174
SoCal	217,000	216,851	228,655	245,331	201,894	355,698
Total	407,000	406,181	421,634	465,654	404,820	753,876

Data courtesy of MDA Dataquick

All forecasts are made by first tuesday based on current data, influential factors and market trends.

The above charts track the home sales volume of single family residences (SFRs) on a month-to-month and annual basis. This includes all resales and new homes in California, including new homes sold directly by the builder.

Recent sales numbers suggest the upcoming years through 2016 will be characterized by a bumpy plateau in home sales volume. Volume and prices slipped slightly during the first half of 2011, and are expected to continue falling through the remainder of the year, with a (short-lived) rise going into 2012 due to historically low prices and interest rates.

Little overall change from 2010’s numbers will occur until California employment growth and homebuyer confidence show consistent improvement over a substantial period of time. For example, in 1994, when the economy began to rise from the recession of 1991, it took 24 consecutive months of improved job numbers for the housing market to respond with increased sales volume.

Current trends in jobs and consumer confidence do not suggest any equivalent improvement in sales volume is imminent. At the time of this writing, 30% of all homeowners cannot sell and relocate because their homes are worth significantly less than the debt encumbering them. Worse, lenders are reluctant to consent to any discounts on short sale payoffs when sellers are even remotely capable of paying on the loan.

first tuesday forecasts home sales volume will return to the 2006 levels around 2017-2018. The peak sales volume last seen in 2005, inflated by speculator acquisitions, may never return at all.

Relocating Baby Boomers going into retirement later this decade will be the primary propelling force in both selling homes and buying replacements. Their Generation Y (Gen Y) children will add to the sales volume as they become first-time homebuyers whose influence will peak at the end of this decade.

Copyright © 2011 by first tuesday Realty Publications, Inc. Readers are encouraged to reprint or distribute this information with credit given to the first tuesday Journal Online — P.O. Box 20069, Riverside, CA 92516.