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Welcome back, everyone. Today I want to go over the real estate market
forecasts for 2015 in Long Beach, Orange County, and the Greater Los
Angeles area.
In 2012 and 2013, we saw significant home appreciation throughout Southern California.
A lot of this demand was fueled by investors coming in and buying homes
that were at depressed prices. It was often times difficult for the
average home buyer to compete with the all-cash offers that investors
were making.
In 2014 we saw the market stabilize
and we saw values for the most part remain pretty flat. California’s
housing market moved away from being largely dominated by investor activity and
strong competition to a more balanced market.
What does that mean going
forward? In 2015, the housing market is expected to continue moving along at a
“normal” pace.
While it is difficult to define what “normal” means after a
decade of volatility, improvements in housing fundamentals along with improvements
in the economy and the job market indicate that a better balance will be
achieved between traditional buyers and traditional sellers.
Improvements
in inventory of homes available for sale will help fuel demand for homes among
buyers. Diminished competition from investors and cash buyers along with slower
price appreciation will restore some confidence back among buyers. Sellers on
the other hand recognize that the market frenzy seen in 2013 no longer exists
and home price growth has stabilized.
The C.A.R. predicts that sales of
existing single-family homes will increase in 2015 by 5.8 percent. Median
prices are also predicted to continue rising, with a predicted change of 5.2
percent to $478,700.
And lastly, interest rates on 30-year mortgages are
predicted to increase at some point in 2015 and are expected to average about
4.5 percent for 2015. Price stabilization, historically low mortgage
rates and greater inventory should make 2015 a very strong year for the housing
market.
If you know of anyone thinking of
buying or selling their home we would love to help them. Thanks for
tuning in.
