CAR has released its 2012 forecast for the California Real Estate Market. CAR notes a slight increase in home prices for 2012. Interest rates are also predicted to rise slightly across the state.

It’s important to remember that the Bay Area lives in its own housing economy. With inventory at an all-time low and tech hiring on its way up, many properties are selling with multiple offers. These areas include Saratoga, Campbell, Los Gatos, Cupertino, Los Altos, Palo Alto, Mountain View, and many other Bay Area cities.

For a great read on the Bay Area’s economy, check out Randy Howder’s “Bubble or Babylon” from the Huffington Post:

Fuelled by the frothy tech sector, both commercial and residential real estate activity in much of the Bay Area are some of the few bright spots in the nation’s otherwise dismal markets.