Home prices in Los Angeles reached record heights by summer of 2018, climbing to levels far above those recorded in the years leading up to the last recession. However, price increases have fallen off since summer, and new data suggests a cooling trend in the market will continue well into 2019. Additional data suggests that home values in Los Angeles will continue to rise next year, but at a significantly slower rate than the nationwide average.
Feedback from many buyers has suggested some buyers are hoping prices will suddenly bottom out. However, it is unlikely home values will bottom out the way they did during the last recession, since mortgage providers are still shying away from the kind of risky home loans that fueled the housing market’s last collapse. The more likely scenario is that home values will continue to grow, but at a more modest rate. Mortgage interest rates were expected to climb above 5% by 2019, however have remained closer to 4.5% since the last spike in November. Experts still predict rates to rise to 5% + into 2019.
Our tips for buyers and sellers in this market:
Buyers have voiced concerns over home affordability and options currently on the market. Should you buy in 2019, continue renting, or sell your current home to upgrade, downsize, or change neighborhoods? This can be a tough decision, and the answer depends on how long you’re planning to stay, and whether you’re ready to make a large financial commitment. If you are willing to stay put for five or more years, buying can be a smart investment. If not, renting may make more sense, given the flexibility it provides and the lower amount of risk. If you already own, have you seen options you would want to purchase or is it an option for you to rent until you find something you love?
As a seller, you still have an advantage in this market due to low inventory. We have seen increased market times over the last quarter, mostly in the luxury market. With that being said, price is a very important detail, but it is also essential to consider your marketplace. What is currently on the market? Are there several homes like yours on the market or do you have a unique opportunity? The LA Properties Group takes pride in finding your home’s unique appeal and marketing this effectively.
The LA Properties Group is happy to navigate through the pros and cons with you, introduce new ideas and neighborhoods, and guide you through the home buying or selling process to ensure a smooth transaction and help you meet your 2019 real estate goals.