Contra Costa County (Calif.) anticipates moderation of real estate market

Contra Costa County (Calif.) Employees' Retirement Association (CCCERA) expects a variety of conditions to result in a moderation of the real estate market, as home sales have fallen to pre-pandemic levels and bidding wars have become less frequent.

Historically, larger jumps in interest rates have resulted in a softening of the real estate market and placed downward pressure on home values. This effect appears to be occurring somewhat in recent months, as evidenced by the dip in sales and bidding.

The pension fund also anticipates that continued tight inventory levels could act as an ongoing support to high prices.

CCCERA shared that nearly every one of its asset classes delivered moderate to deeply negative returns during the second quarter of the year, amid fears of inflation and a recession.