The California Association of Realtors (C.A.R.) forecasts a more favorable interest rate environment in 2025, easing the "lock-in" effect and improving housing inventory. Existing single-family home sales are expected to rise by 10.5% to 304,400 units, with median home prices increasing by 4.6% to $909,400. Lower borrowing costs and increased listings will attract buyers and sellers, particularly first-time buyers. While inventory is projected to improve, demand will also rise, keeping the market competitive despite a modest slowdown in price growth.

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