The Bay Area is projected to lead the U.S. for home price gains in 2017 according to's 2017 National Housing forecast. Nationally home prices are forecast to grow by 3.9%. Western states are projected to lead the market at 5.8%. Home price gains in San Francisco and San Jose are expected to be double the national rate at 8.41% and 8.26% respectively. The TriValley should fall somewhere in the 6-7% range in most cities. In 2016, home price appreciation in the TriValley was 7%. Inventory  increased by 11% but the number of homes sold dipped by 3%. Housing affordability has become an issue. As home prices increase, some buyers will be priced out of the market. Interest rates have been fluctuating between 4.125 and 4.5% over the last couple of months. Most analysts are predicting the interest rate will be 5% by the end of the year. Buyers are definitely out shopping for homes. Last weekend open houses were very busy. I think we will see a very robust spring market this year as buyers try to get ahead of the next interest rate increase.