In Southern California, a slight slowdown in the housing market still means record prices

Written by Desmond

December 16, 2021

Southern California home prices jumped nearly 16% in November from a year earlier, showing how the market is still ultra-competitive despite a slight slowdown that began to set in several months ago.

Some buyers sat out the bidding wars after a particularly frenzied period last spring, but plenty of shoppers stayed the course, driving prices up to successive new records in recent months.

The region’s six-county median sales price reached an all-time high of $693,500 in November, according to data released Thursday by real estate firm DQNews. That’s 0.5% higher than in the previous month, October, and 15.6% higher than in November 2020. Sales rose 1.8% from that year-earlier period.

Some economists expect home price appreciation will slow to single digits next year, in part because they expect mortgage rates will rise. That could be more likely to happen after the Federal Reserve on Wednesday announced more aggressive plans to fight inflation, but for now average mortgage interest rates remain in the low 3% range.

Business

What $600,000 buys in 6 L.A. County communities

Here’s a look at what $600,000 buys in six communities scattered across L.A. County.

In addition to historically low borrowing costs, several other factors continue to fuel today’s competitive market with fast-rising prices. More millennials want to become first-time buyers, and investors are increasingly buying homes to rent or flip. In addition, many white-collar workers did well financially during the pandemic and put some of their booming stock portfolios into down payments.

Squeezing the market is the supply of homes for sale, which is at record lows. That has potential buyers one-upping one another in bidding wars that cause homes to sell for tens, even hundreds of thousands of dollars over list price.

The sharp price increases are pushing some people to leave their communities to afford a home, moving from Los Angeles to San Bernardino and from San Bernardino out of state altogether, to places such as Arizona.

In November, the biggest price rises from a year earlier were in the Southland’s less-expensive counties of Riverside and San Bernardino, which each hit new median home price records.

In Los Angeles and Orange counties, November home prices hovered below the record levels reached, respectively, in September and October, but they were significantly higher than in November 2020.

Business

These are L.A.’s new million-dollar neighborhoods

Do you live among million-dollar homes? These 15 L.A. neighborhoods crossed the $1-million threshold

Many economists and housing policy experts say Southern California, and the nation as a whole, must build far more homes — both market rate and subsidized — if owning and renting are to be more affordable. But developers say restrictive building and zoning rules, particularly in California, have long limited their ability to meet demand, and lately, supply chain issues have delayed some projects even more.

Whether relief for buyers is on the horizon remains to be seen.

In recent months, the market has cooled somewhat, with real estate agents reporting bidding wars are less intense but still common. Competition for homes typically wanes in fall and winter, so it’s difficult to know how much of the slowdown is the result of normal seasonal patterns versus a market that will be better for buyers in the long run.

Selma Hepp, an economist at CoreLogic, said she expected more of a slowdown in sales by now, noting that transactions usually fall between October and November but dropped less this year than normal.

The annual median price increase for all of Southern California, 15.6%, is lower than the 20% rise that was common in months earlier this year, but it’s also a few percentage points higher than a recent low of 12.6% in September.

Business

California holds 70% of the country’s priciest ZIP Codes for home buyers

California maintains its reign as the most expensive state in the U.S. for home buyers, with 89 of the nation’s 127 priciest ZIP Codes, a new study finds.

This slight acceleration of year-over-year price increases the last two months could indicate a pickup in price appreciation is underway, but Hepp said she doesn’t believe that’s the case. The pickup is probably due to more luxury homes selling, therefore pushing the median value slightly higher, rather than a true price acceleration, she said.

CoreLogic predicts year-over-year home price gains will slow in 2022, reaching 1.9% in L.A. County by November of next year. John Burns Real Estate Consulting also expects a price slowdown next year, to the high single digits.

A CoreLogic index that aims for a more accurate — if delayed — view of prices than the median shows a slowdown has started, though barely. According to that index, L.A. County prices rose 14.1% in November from a year earlier, compared with a 14.9% year-over-year gain in August.

For now, here’s a county-by-county breakdown of home prices and sales in November compared with a year earlier, as tracked by DQNews.

After the holidays, declutter (then re-clutter)

After the holidays, declutter (then re-clutter)

Another magical holiday season has come to a close. The holidays may still not feel quite like “normal” yet, but I still enjoyed bringing out my favorite decorations from Halloween to Thanksgiving to the Christmas finale. Having holiday decor...

$425,000 Homes in Indiana, Ohio and Pennsylvania

$425,000 Homes in Indiana, Ohio and Pennsylvania

24 PhotosView Slide Show ›Fletcher Place Historic District, one of Indiana’s oldest urban neighborhoods, was added to the National Register of Historic Places in 1982. This house is just outside the boundaries of the official historic district,...

Some articles from around the MLHA Nation you might like...

0 Comments

Submit a Comment

Getting More Local

Setting Up Shop In Your Area Soon!

Coming Soon!

My Local Home Value

MARKETPLACE

Interactive and Intuitive Digital Magazine focused on the housing markets and home values of Your Area.

Sample is of 

My Seattle
Home Value
Marketplace

Coming Soon!

Vounce HOME VALUE

MARKETPLACE

Interactive and Intuitive Digital Magazine focused on the housing markets and home values of Your Area.

Sample is of 

My Seattle
Home Value
Marketplace

Coming Soon!

My Local Home Value

MARKETPLACE

Interactive and Intuitive Digital Magazine focused on the housing markets and home values of the area you live.

Sample is of

My Seattle
Home Value
Marketplace

Appraiser Interview Guide

We have a combined 70+ years of appraisal experience. It makes us happy to share this with you. Let's jump right in then!

1. The first thing is a lot like many things you might get ready to do is to get your ducks in a row, and have a game plan for setting up your appraisal. And of course  you can't know everything about everything so the right appraiser will provide those answers, and you will get the best results.

2. Have your property information readily available when talking with the appraiser...

Get the complete Appraiser Interview Guide delivered directly to your email box in a readable and downloadable format, there's no cost.

Locations By State

We have all Current Certified Residential and Licenced Appraisers in the country. You can simply get started anytime.
We have also setup in many cities and metro areas as well as a centalized base for many rural locations. We will setup more locations each week.

Washington  |  Oregon  |  California  |  Texas  |  New York  |  Illinois  |  Florida  |  Pennsylvania  |  Washington DC

Locations By State

We have all Current Certified Residential and Licenced Appraisers in the country. You can simply get started anytime.
We have also setup in many cities and metro areas as well as a centalized base for many rural locations. We will setup more locations each week.

Washington  |  Oregon  |  California  |  Texas  |  New York  |  Illinois  |  Florida  |  Pennsylvania  |  Washington DC

Home Office

Portland, OR

Phone

503 781-0448

Contact Us

Copyright ©2021 • My Local Home Appraiser

Copyright ©2021 • My Local Home Appraiser

Phone: (503) 349-3765  Home Office: Portland, OR  |  Email: contact@mylocalhomeappraiser.com

  Email: contact@mylocalhomeappraiser.com