The San Fernando Valley Los Angeles region’s housing market has remained solid. Presently we have the seasonal slowdown in play, but the recent drop in mortgage rates will no doubt stimulate activity.
Affordability levels are low because of the higher rates and values. The lower rates will help affordability, but that will only increase the capabilities of the pent-up buyer base adding pressure to the market.
Take a look at the charts. Inventory is low, so corresponding closed sales are low. Not because lack of buyers. Prices are higher, because of the supply and demand imbalance.
Corelogic released an equity report recently showing the average loan-to-value of existing housing with mortgages is 42%. That shows existing property owners have a massive amount of equity. Back in the 2008 Housing Bubble, the average loan-to-value was 81%. Presently only 2% of mortgaged properties have negative equity.
As mortgage rates come down, owners who are locked into their existing housing with Pandemic low mortgage rates will have less incentive to stay in a property that doesn’t serve their current needs.
The housing market and interest rates should stabilize over the next couple of years. The Forecasted Appreciation reflected in the chart looks like a lot but is potentially conservative, given the low housing stock, and a huge generation of potential buyers are hitting the prime buying years.
First-time buyers, and any existing owner considering selling, relocating, expanding their real estate portfolio, getting rid of an annoying rental, considering a debt consolidation mortgage, or getting a Reverse Mortgage should call me to strategize… It’s never too early.
If you are in the Los Angeles area, and have any questions or real estate sales or financing needs, feel free to contact me
Ron Henderson GRI, SRES, SFR, RECS, CIAS, GREEN
President/Broker
Multi Real Estate Services, Inc.
Gov’t Affairs Chair – California Association of Mortgage Professionals (2017-2018)
Chairman – OutWest Marketing Meeting (Real Estate Education)
BRE #00905793 NMLS #310358
www.mres.com
ronh@mres.com
Specialist in the Art of Real Estate Sales and Finance
Real Estate market, mortgage rates, Los Angeles, San Fernando Valley, Conejo Valley, Simi Valley, Woodland Hills, West Hills, Calabasas, Chatsworth
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