A Strong Percentage of Homes Are Selling Above Asking Price
Apr 15, 2021 11:00 am | Long Beach/Southern California Real Estate
In January, 2021, over 56% of homes statewide sold over the asking price. This is according to a Southern California April presentation by a California Association of Realtors economist as shown in the slides to the right. The over-asking statistics may vary in areas, so for example, in a combined look at 180 sales of condos and houses between 4/8 and 4/15 in the 10 cities of Bellflower, Cypress, Harbor City, Long Beach, Carson, Torrance, Lakewood, Lomita, San Pedro, and Signal Hill*:
71% (approx.) or 127 homes out of 180 sold over asking. 7% (approx.) or 12 homes sold at original list price. 19% (approx.) or 35 homes sold under original list price. In lower prices starting at $300,000, the increase may be $900 to $15,000; in the $500,000 range the increase in closing price grew in some cases to over $50,000 higher, and in the $1,000,000+ category it may $150,000 higher. However, one single family home listed in Long Beach for $595,000 recently closed at $700,000. For sellers such overbids may help them more easily into their next purchase, but for the huge number of first time buyers looking for opportunity with very low interest rates, there is much frustration. On many properties, multiple offers abound, often 15-20 offers from which the seller may pick, sometimes outright, sometimes countering back to a select group of buyers.
In a March 2021 Google Consumer poll, 64% of sellers thought it was a good time to sell, while 28% of buyers thought it was a good time to buy. In 2020 however, 44% of buyers had more than a 20% down payment, and obviously many of them have the ability to bid some much higher prices to beat out the competition. This leads to another issue: appraisals. Not all overbid prices are appraising, leading buyers to come up with more money, and how some are doing this is detailed in this article about the appraisal gap.
Who's not buying so much? Rental property investors, as COVID issues came to the frontline.
What will make the situation easier in the future? Rising interest rates, more housing inventory, and an ongoing improving economy.
*as reported in CRMLS
Julia Huntsman, REALTOR, Broker | www.juliahuntsman.com | 562-896-2609 | California Lic. #01188996
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Housing Supply Stats for Los Angeles County, as of February 2021
Apr 08, 2021 02:01 pm | Long Beach/Southern California Real Estate
| LA County 2/21 Housing Supply
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This graphic for Los Angeles County quickly shows a 27% decrease in listings compared to February of 2020. This is a theme repeated over and over throughout other cities and the state. The top right bar graphs show in green where listings are this year compared to last year in red. Last year's Time Trend show the huge dip as the pandemic conditions were being dealt with, and then an increase above the line for 2021, but no where near the activity for 2020, shown in green bars. The pricing on Active Listings demonstrates the under-$200,000 market is very slim, with approximately one-third of the market priced between $300,000-$750,000, another (approximately) one-third between $1.0 million to $1.5 million, and the remaining third priced over $2,000,000. All price ranges see a decrease in numbers of listings, but the largest deficit is in the lowest end of the market.
In the Home Price Interactive, the bottom right graph | Income vs. loan payment, LA County
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shows how income has risen in Los Angeles County since before 2000, from $35,000 annually, up to the present $75,000 annual income. But the payment line (green) has dipped up and down over time, reflecting the downtimes of the Great Recession and foreclosures after 2007, and recovery period after that. But according to this graph, the difference between current mortgage payment levels and annual income is at a midpoint, similar to the loan payment-annual income scenario prior to 20000.
For a home valuation, please go to my website for an automated valuation, or contact me directly for a comparative market analysis.
Julia Huntsman, REALTOR, Broker | www.juliahuntsman.com | 562-896-2609 | California Lic. #01188996
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Fire Protection: Home Hardening Law for 2021 in California
Apr 07, 2021 11:21 am | Long Beach/Southern California Real Estate
Are you a property owner who's considered fire resistant materials for your home? If you already have made certain changes, you're probably closer to protecting your property in case of wildfire. Wildfires are not just in a certain part of the state, for instance, they could happen anywhere you live near brush and vegetation. A new law came into effect January 1, 2021 that requires a disclosure for properties that are: • Within high or very high fire hazard zones • Built before 2010 • Residential one to four properties; condominiums or other common interest development units; or manufactured homes The fire zones are disclosed in the natural hazard disclosure statements required in property transactions, where the box is checked on the form for which zone(s) the property is in. Natural Hazard Disclosure reports and statements, required in California, are most often completed by professional sources which assume the liability for and have access to statewide reports concerning the hazard zones and required disclosures in California law. California Association of Realtors now includes a disclosure form for sellers as part of their transactional documentation in a sale to cover requirements under the new law.
Fire hardening measures include Class A fire rate roofing materials (composition, tiles, steel), using 1/8" mesh at chimneys and vents, using screens over rain gutters, keeping vegetation at least 5 feet from the property, and multi-paned tempered glass. Parts of Los Angeles and Orange Counties may be significant for taking measures, but even in non-high-fire zones, they are a good idea for overall home maintenance and protection. CalFire's website https://www.readyforwildfire.org/ contains this agency's advice on preparing for wildfire.
Julia Huntsman, REALTOR, Broker www.juliahuntsman.com | 562-896-2609 | California Lic. #01188996
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2020 Single Family Review for Los Angeles County
Mar 16, 2021 03:39 pm | Long Beach/Southern California Real Estate
| | LA County House Snapshot for 2020 |
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Last year saw a consistent dip in all housing metrics after the beginning of the pandemic shutdown, but then a recovery began mid-year that hasn't stopped since. The current market is marked with multiple offers and prices shooting upward since the end of January 2021. The close of February showed an average house price for the County sitting at $1,232,890, an increase of 23% over one year ago, while the median price was $830,000. February's average County-wide home price of $1,232,890 exceeds any average home price since 2008 and before. Some of the properties are seeing an increase of $50,000 sale price over list price, while others are selling at or just above list price; one property in California Heights in Long Beach was listed at $699,000 and sold for $850,000. It's not unusual for 15-20 offers or more, for houses that are move-in ready and partially or fully upgraded. Months inventory, meaning how many houses are actually available for sale, is critically low, and it is this low inventory that fuels the upward price surge. For January and February, months supply is 1.8 months (normal inventory supply is 6 months, but that's been gone since 2012). Interest rates have been well below 3%, but with a recent increase in rates, mortgage applications have slowed. If you would like a market evaluation for your home or condominium, please contact me. It's an ideal time to sell.
Julia Huntsman, REALTOR, Broker | www.juliahuntsman.com | 562-896-2609 | California Lic. #01188996
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How Is Housing So Strong Right Now?
Mar 02, 2021 10:47 am | Long Beach/Southern California Real Estate
If you're a potential buyer or seller sometime in the past year, you've had some experience with Property Entry and Advisory Declaration (PEAD) forms, required for all prospective buyers to sign before entering a listed home on the market. To backtrack a little, both the national and California economies have recovered, and COVID figures are on the decrease at this time. Looking back to Feb.-April of 2020, earning data shows that job losses for people earning over $100,000 annually were at 12%; job losses for earners under $100,000 annually were at 88% -- the retail, food industry and other service jobs were the hardest hit, while the other job categories over $100,000 income were not hit nearly as hard. Interest rates are at historic lows and are likely to stay that way for sometime to come. Mortgage applications dipped last Spring, but climbed way up in January 2021, all of which is fueling home sales in 2021. California saw a 22% increase over last year in number of homes sold, over 484,000 in one month (but compare to January of 2005 when over 600,000 sold). In December, 2020, total California home price rose to $717,930 (+16.8% from last year); fueled also by low inventory (-48%), leading to median of 11 days on market and a list-to-sales-price ratio of 100.1% (+1.9%). Southern California home prices have increased to $650,000, overall, over 16% since one year ago, and sales have increased 13% year over year: By county, OC at $971,000; LA at $697,660; Riverside $495,500; San Bernardino $390,000; San Diego $730,000; Ventura $776,000. This is the strongest growth in California in 7 years. Only 5% of sales are all cash, but two of five homes were sold to first time homebuyers. And 33% of those 1st timers had more than 20% down payment!! Yes, parents, friends and family are helping them out. So as the charts above show, showing traffic shows the homebuying momentum as the PEAD forms are tracked in various counties. Lately the showing pattern is: put home on market mid-week, showings take place at 15 minute intervals Friday, Saturday, Sunday, offers are due in Sunday or Monday, by Wednesday of the following week, the buyer is found. Needless to say, winning offers are completely documented with solid loan pre-approvals and proofs of funds. This is a hectic time for buyers who must compete and be prepared (on some properties) to overbid.
With the lowest housing supply in years, most sellers who can think about making a change will get showing activity. If you're wanting a home value estimate, this is a good time to contact a Realtor. See the complete housing report here
Julia Huntsman, REALTOR, Broker | www.juliahuntsman.com | 562-896-2609 | California Lic. #01188996
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