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Southern California Real Estate Market Review
Manage episode 153352986 series 1087857
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In LA County, the average price for a single family home was $540,000, which is a 4% increase for the year. Homes in LA County are selling for 98.8% of the asking price.
In Orange County, the average price for single family homes was $695,000, which is a 2% increase. Homes in Orange County are selling for 97% of the original asking price.
We have particularly low inventory in Orange County and LA County currently. In fact, both counties have 2.6 months of inventory, which is the lowest inventory we've seen in the past ten years. We expect this to set us up for a very strong 2016.
We are currently experiencing interest rates between 3.75% and 4%. In mid December, the Fed increased interest rates by 0.25%. Although this seems like a slight increase, it profoundly affects your mortgage payments. Additionally, we might experience rate hikes again in 2016.
We expect that the market in Southern California will go up 3% to 5% for 2016. Keep a lookout for affordability. Right now, only 30% of the population in LA County can afford the median sales price. In the OC, only 22% can afford to pay the median sales price. That's why we're not seeing the major increases in price that we saw in 2012 and 2013. Affordability has hit a bit of a plateau.
If you have any questions about today's video, give us a call or send us an email. We would be happy to help you!
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