The abnormal scarcity — compounded by the region’s long-running underproduction of housing — emerged when homeowners chose not to sell and give up pandemic-era mortgage rates. The so-called seller strike helped pushed home values to new records, despite rising borrowing costs.

Now the inventory picture might be changing.

“It’s getting a little bit better,” said Eneida Contreras, a Compass real estate agent who specializes in the San Fernando, Santa Clarita and Antelope valleys.

In April, the number of homes listed for sale in most Southern California counties rose from the same month a year earlier, according to data from Zillow.

Los Angeles, Riverside, San Bernardino and Ventura counties turned positive for the first time since the first half of 2023, each recording an increase of at least 5%.

Orange was the only county to see a decline, while in San Diego, inventory has risen for two consecutive months and is 18% above what it was a year ago.

To be sure, the availability of homes remains at historically low levels. But as it rises, it opens the possibility that prospective buyers will have an easier time making the largest purchase of their lives.

Jordan Levine, chief economist with the California Assn. of Realtors, said more homes are coming onto the market because owners are increasingly accepting that the new normal is interest rates in the 6%-7% range.

As people get married, divorced and have children, the “benefit of the low rate starts to be outweighed by having a house that doesn’t work,” Levine said. “Ultimately, these are people’s homes, too, and they are not just straight-up investments.”

Levine said he expects inventory levels to increase and home prices to be lower than they would have been if inventory continued to shrink. However, he and other experts said home prices are unlikely to decline. That’s because though more owners are coming to terms with high rates, many will likely choose to keep their sub-4% mortgages — a phenomenon known as the lock-in effect.

Other factors are at play. The economy is growing, and while most Southern California households can’t afford to buy, there’s a sizable population of techies, Hollywood types and other white-collar workers who can funnel excess cash into large down payments that offset high mortgage rates.

“The current level of inventory rise — which is a little bit, but not a lot — is likely to slow price appreciation but not turn it negative,” said Mike Simonsen, founder of Altos Research, a real estate data firm.

The rise in inventory is providing opportunities for buyers with means, but the market is still tough.

Interest rates are above 7%, and even if home prices rise at a slower pace, they will set records.

In Los Angeles County, the average home price in April was $890,516, an increase of 1.4% from March and surpassing the previous record, set in June 2022.

The six-county Southern California region climbed above its 2022 average home price record in March. It set another all-time high last month, reaching $875,388.

If mortgage rates noticeably decline, the lock-in effect could lessen and bring more homes onto the market. Falling mortgage rates would also immediately make housing more affordable.

Whether falling rates provide much relief is another question. Lower borrowing costs may bring a flood of additional buyers who quickly gobble up new listings and supercharge price growth.

“Building more housing is really what is going to break that cycle,” said Nicole Bachaud, a senior economist with Zillow.

According to the latest forecast from the Mortgage Bankers Assn., rates will remain high but will drop to 6.4% by the end of 2024.

Carol Otero of Rodeo Realty is among the Los Angeles agents seeing an increase in inventory. She estimated that the number of homes for sale in some San Fernando Valley neighborhoods has at least doubled in the past few weeks.

Buyers are eager.

Last Friday, Otero listed a four-bedroom home in Northridge. She said she has received six offers, all above the $869,000 asking price.

The post Buying a home in Southern California? There are now more options appeared first on The Hemet & San Jacinto Chronicle.

The abnormal scarcity — compounded by the region’s long-running underproduction of housing — emerged when homeowners chose not to sell and give up pandemic-era mortgage rates. The so-called seller strike helped pushed home values to new records, despite rising borrowing costs.

Now the inventory picture might be changing.

“It’s getting a little bit better,” said Eneida Contreras, a Compass real estate agent who specializes in the San Fernando, Santa Clarita and Antelope valleys.

In April, the number of homes listed for sale in most Southern California counties rose from the same month a year earlier, according to data from Zillow.

Los Angeles, Riverside, San Bernardino and Ventura counties turned positive for the first time since the first half of 2023, each recording an increase of at least 5%.

Orange was the only county to see a decline, while in San Diego, inventory has risen for two consecutive months and is 18% above what it was a year ago.

To be sure, the availability of homes remains at historically low levels. But as it rises, it opens the possibility that prospective buyers will have an easier time making the largest purchase of their lives.

Jordan Levine, chief economist with the California Assn. of Realtors, said more homes are coming onto the market because owners are increasingly accepting that the new normal is interest rates in the 6%-7% range.

As people get married, divorced and have children, the “benefit of the low rate starts to be outweighed by having a house that doesn’t work,” Levine said. “Ultimately, these are people’s homes, too, and they are not just straight-up investments.”

Levine said he expects inventory levels to increase and home prices to be lower than they would have been if inventory continued to shrink. However, he and other experts said home prices are unlikely to decline. That’s because though more owners are coming to terms with high rates, many will likely choose to keep their sub-4% mortgages — a phenomenon known as the lock-in effect.

Other factors are at play. The economy is growing, and while most Southern California households can’t afford to buy, there’s a sizable population of techies, Hollywood types and other white-collar workers who can funnel excess cash into large down payments that offset high mortgage rates.

“The current level of inventory rise — which is a little bit, but not a lot — is likely to slow price appreciation but not turn it negative,” said Mike Simonsen, founder of Altos Research, a real estate data firm.

The rise in inventory is providing opportunities for buyers with means, but the market is still tough.

Interest rates are above 7%, and even if home prices rise at a slower pace, they will set records.

In Los Angeles County, the average home price in April was $890,516, an increase of 1.4% from March and surpassing the previous record, set in June 2022.

The six-county Southern California region climbed above its 2022 average home price record in March. It set another all-time high last month, reaching $875,388.

If mortgage rates noticeably decline, the lock-in effect could lessen and bring more homes onto the market. Falling mortgage rates would also immediately make housing more affordable.

Whether falling rates provide much relief is another question. Lower borrowing costs may bring a flood of additional buyers who quickly gobble up new listings and supercharge price growth.

“Building more housing is really what is going to break that cycle,” said Nicole Bachaud, a senior economist with Zillow.

According to the latest forecast from the Mortgage Bankers Assn., rates will remain high but will drop to 6.4% by the end of 2024.

Carol Otero of Rodeo Realty is among the Los Angeles agents seeing an increase in inventory. She estimated that the number of homes for sale in some San Fernando Valley neighborhoods has at least doubled in the past few weeks.

Buyers are eager.

Last Friday, Otero listed a four-bedroom home in Northridge. She said she has received six offers, all above the $869,000 asking price.

The post Buying a home in Southern California? There are now more options appeared first on The Hemet & San Jacinto Chronicle.

Oliver Povey | Contributor

The covid-19 pandemic was a great year for homeowners. Prices soared, encouraged by record-low interest rates. This was as true in California compared to any other state, despite having some of the highest average prices in the country even before 2020. According to Zillow, prices peaked at more than $771,000 in July of last year. Staggeringly for buyers, homes have increase by an average price of $210,000 since April 2018.

But a smidge of good news could be coming Californian home-buyers way. The average house price has dropped in the last year, falling 1.7% since April 2022 to stand at $728,134.

Home prices are likely to continue falling. The median cost of existing-homes in the country fell in February for the first time in more than ten years. Prices are expected to fall nationally by 5% with the bulk of the price falls to happen in expensive areas, affecting California greatly.

“We’re estimating about a 5% drop nationally,” says Rick Sharga, executive vice president of market intelligence at ATTOM Data.

A big shake-up could be underway on the Pacific coast. Investment bank Goldman Sachs advised clients in a January letter that four US cities will see a major boom-to-bust comparable to that experienced during the 2008 housing bubble. At that time, across the US home prices tanked around 27% according to the S&P CoreLogic Case-Shiller index leading to the Great Recession.

Two of these cities are in California; strategists from the bank forecast homes in San Jose and San Diego could lose about 25% of their value.

Instability with the FED and inflation likely to affect housing prices

These price reductions are in part a consequence of the higher interest rates encouraged by the Federal Reserve. Consistent rate increases, with another set for May, make it less encouraging to borrow money, a crucial aspect of home buying unless you are very rich.

Less people are buying houses, or are less willing to pay so much knowing their repayments will be larger. This is echoed in data provided by Zillow which shows more than half of homes in California being sold under their listed prices last year as well as existing-home sales being down 22.6% nationally on a year prior.

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Stacker | Contributed

Cities with the fastest growing home prices in Riverside metro area.

It goes without saying that the coronavirus pandemic has sparked a wave of uncertainty across myriad industries, and not other market has quite felt its impact like that of real estate.

The pandemic has become a driving force behind the continued real estate boom, with high demand for vacation homes and a limited supply of housing that has prompted buyers and investors to bid up prices for affordable properties, causing home prices to skyrocket. The ability to work remotely played a role in the vacation home demand in mid-2020, as affluent Americans opted to ride out the pandemic with more amenities and space outside dense urban areas.

Stacker compiled a list of cities with the fastest-growing home prices in Riverside-San Bernardino-Ontario, CA metro area using data from Zillow . Cities are ranked by 1-year price change as of August 2022. The typical home value in the United States increased over the last year by +14.1% to $356,054. Data was available for 91 cities and towns in Riverside.

30. Cathedral City, California

– 1-year price change: +$81,326 (+18.7%)

– 5-year price change: +$240,742 (+87.6%)

– Typical home value: $515,670 (#44 most expensive city in metro)

29. Moreno Valley, California

– 1-year price change: +$81,849 (+17.7%)

– 5-year price change: +$242,556 (+80.0%)

– Typical home value: $545,572 (#37 most expensive city in metro)

28. Upland, California

– 1-year price change: +$82,998 (+11.8%)

– 5-year price change: +$276,309 (+54.2%)

– Typical home value: $786,374 (#6 most expensive city in metro)

27. Idyllwild, California

– 1-year price change: +$83,452 (+18.1%)

– 5-year price change: +$246,544 (+82.7%)

– Typical home value: $544,811 (#38 most expensive city in metro)

26. Beaumont, California

– 1-year price change: +$83,493 (+17.9%)

– 5-year price change: +$235,564 (+74.9%)

– Typical home value: $549,908 (#36 most expensive city in metro)

25. Lake Elsinore, California

– 1-year price change: +$83,980 (+16.5%)

– 5-year price change: +$255,302 (+75.5%)

– Typical home value: $593,581 (#28 most expensive city in metro)

24. Menifee, California

– 1-year price change: +$84,358 (+16.9%)

– 5-year price change: +$247,309 (+73.4%)

– Typical home value: $584,124 (#29 most expensive city in metro)

23. Chino, California

– 1-year price change: +$84,799 (+13.2%)

– 5-year price change: +$267,779 (+58.1%)

– Typical home value: $728,592 (#11 most expensive city in metro)

22. Perris, California

– 1-year price change: +$84,867 (+18.9%)

– 5-year price change: +$241,326 (+82.3%)

– Typical home value: $534,484 (#40 most expensive city in metro)

21. Rancho Cucamonga, California

– 1-year price change: +$89,346 (+13.2%)

– 5-year price change: +$279,707 (+57.6%)

– Typical home value: $765,225 (#8 most expensive city in metro)

20. Wildomar, California

– 1-year price change: +$90,057 (+16.0%)

– 5-year price change: +$273,113 (+72.1%)

– Typical home value: $652,141 (#17 most expensive city in metro)

19. Aguanga, California

– 1-year price change: +$91,923 (+18.7%)

– 5-year price change: +$243,667 (+71.7%)

– Typical home value: $583,472 (#30 most expensive city in metro)

18. Mountain Center, California

– 1-year price change: +$95,945 (+19.0%)

– 5-year price change: +$247,788 (+70.3%)

– Typical home value: $600,406 (#26 most expensive city in metro)

17. Winchester, California

– 1-year price change: +$96,699 (+16.0%)

– 5-year price change: +$292,519 (+71.7%)

– Typical home value: $700,542 (#13 most expensive city in metro)

16. Murrieta, California

– 1-year price change: +$98,064 (+16.4%)

– 5-year price change: +$288,820 (+70.9%)

– Typical home value: $696,410 (#14 most expensive city in metro)

15. Corona, California

– 1-year price change: +$98,944 (+15.1%)

– 5-year price change: +$301,913 (+66.5%)

– Typical home value: $755,775 (#10 most expensive city in metro)

14. Joshua Tree, California

– 1-year price change: +$101,157 (+27.7%)

– 5-year price change: +$282,752 (+153.9%)

– Typical home value: $466,422 (#48 most expensive city in metro)

13. Norco, California

– 1-year price change: +$101,669 (+14.0%)

– 5-year price change: +$327,751 (+65.6%)

– Typical home value: $827,429 (#5 most expensive city in metro)

12. Lake Arrowhead, California

– 1-year price change: +$102,099 (+18.9%)

– 5-year price change: +$290,752 (+82.8%)

– Typical home value: $641,718 (#19 most expensive city in metro)

11. Fawnskin, California

– 1-year price change: +$102,617 (+24.7%)

– 5-year price change: +$254,135 (+96.3%)

– Typical home value: $518,162 (#42 most expensive city in metro)

10. Big Bear Lake, California

– 1-year price change: +$104,957 (+20.1%)

– 5-year price change: +$293,839 (+88.4%)

– Typical home value: $626,321 (#22 most expensive city in metro)

9. Indio, California

– 1-year price change: +$108,130 (+24.8%)

– 5-year price change: +$244,139 (+81.3%)

– Typical home value: $544,360 (#39 most expensive city in metro)

8. Temecula, California

– 1-year price change: +$109,956 (+16.9%)

– 5-year price change: +$316,092 (+71.0%)

– Typical home value: $761,035 (#9 most expensive city in metro)

7. Chino Hills, California

– 1-year price change: +$112,842 (+13.6%)

– 5-year price change: +$313,875 (+49.7%)

– Typical home value: $945,122 (#2 most expensive city in metro)

6. Palm Desert, California

– 1-year price change: +$114,981 (+24.0%)

– 5-year price change: +$257,813 (+76.6%)

– Typical home value: $594,566 (#27 most expensive city in metro)

5. Eastvale, California

– 1-year price change: +$137,331 (+17.6%)

– 5-year price change: +$376,533 (+69.5%)

– Typical home value: $918,134 (#3 most expensive city in metro)

4. Palm Springs, California

– 1-year price change: +$148,416 (+25.7%)

– 5-year price change: +$351,872 (+94.1%)

– Typical home value: $725,934 (#12 most expensive city in metro)

3. La Quinta, California

– 1-year price change: +$153,637 (+24.5%)

– 5-year price change: +$345,781 (+79.4%)

– Typical home value: $781,290 (#7 most expensive city in metro)

2. Rancho Mirage, California

– 1-year price change: +$180,465 (+25.5%)

– 5-year price change: +$390,158 (+78.5%)

– Typical home value: $886,919 (#4 most expensive city in metro)

1. Indian Wells, California

– 1-year price change: +$273,743 (+25.7%)

– 5-year price change: +$562,687 (+72.6%)

– Typical home value: $1,338,185 (#1 most expensive city in metro)

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Tim Grobaty | Contributed

Long Beach’s California Heights neighborhood, the city’s largest historical district, was baptized in oil.

The area just north of Signal Hill was once grazing land for Jotham Bixby’s livestock on his family’s Bixby Ranch, later named Rancho Los Cerritos. When oil was discovered on Signal Hill in 1921, Jotham Bixby’s Land Company subdivided the tract and offered individual sites for sale, strongly suggesting that you’d become a wealthy landowner once oil was struck in the lowlands, mere blocks away from the oil-rich hill. The lots, priced from $600 to $800, included oil rights, and a series of full-page ads placed by the Jotham Bixby Land Co., in the local papers touted the riches sure to come the buyer’s way: “If you want to be able to saturate your language with oil—if you want the thrill of finding ten-dollar bills in your pocket where only ones used to grow…” then you are advised to pick up a lot in the California Heights tract.

For a while, the land teetered between becoming an oil field or a residential neighborhood and when the oil didn’t pan out, homes began to spring up rather rapidly.

Some of the earlier structures, mostly Craftsman bungalows, were moved down off Signal Hill to make room for derricks, and from an increasingly retail-centered Downtown, while later houses were built, largely in the Spanish Colonial Revival style as the neighborhood’s construction moved east from Lime Avenue to, eventually, Gardenia Avenue, between Bixby and Wardlow roads.

Today, California Heights is quickly becoming one of the hottest neighborhoods in the city for home sales, thanks in a large part to its location close to high-paying jobs at the booming space technology industries near Long Beach Airport on land that decades ago brought solid salaries to households in Lakewood Village and East Long Beach, bringing a population explosion to those areas in the 1950s and 1960s.

Its location is a perfect draw for people working in the space industry, with companies like Relativity, Virgin Orbit, Rocket Lab, SpinLaunch and Space X rapidly increasing their workforces nearby, along with many attractive amenities in the area including LBX, SteelCraft and the Bixby Knolls shops and restaurants. Add to that the cachet of living in a historic district with attractive homes nestled along streets lined with century-old trees, nice parks and good schools and it should be no surprise that even small homes in Cal Heights are hitting the million-dollar mark.

One example is a two-bedroom, two-bath home at 3721 Lemon Ave., which was listed by Realtor Ben Fisher at $950,000 and is now in escrow after an offer in the million-dollar neighborhood was accepted.

“I thought $950,000 was crazy, but we got five offers in three days, all over asking,” said Fisher.

He noted that another house in the neighborhood, three blocks to the south, a five-bed, three-bath home on Myrtle Avenue, also listed by Fisher, is also in escrow at a price “significantly more” than the $1.175 million asking price.

Another home on Myrtle hit the market late last week, listed by Realtor Debra Greco . The beautiful three-bedroom, two bathroom, 1,583-square foot Craftsman at 3754 Myrtle Ave. The 1914 home was moved to Cal Heights from Signal Hill in 1920, said Greco who expects multiple offers on the place by today. The asking price is $1.049 million.

Inventory is low now in the district of nearly 1,500 homes, with only fewer than a half-dozen currently on the market, all listed at close to or over $1 million.

“It’s wild,” said Fisher. “The home on Lemon, selling for $1,000 per square foot, might be a record in Cal Heights. That’s Naples numbers.”

Fisher puts the rapid rise to a number of factors, not least is the proximity to the space technology facilities and the number of good- to high-paying jobs. Relativity, for instance, has hired about 600 employees, with that number set to increase to nearly 1,100 by 2026 along with a projected investment of almost $320 million over the same period. Local economists estimate that the combined space-related businesses in Long Beach account for more than 6,500 jobs.

“I’m always hearing from people about how cool it is that they can ride their bikes to work,” said Fisher. “And they love places like SteelCraft and LBX,” and, says Fisher, a big draw is how nice a house they can get in a good neighborhood for their money as opposed to Los Angeles, where many Long Beach homebuyers are coming. Despite the fact that a million dollars is undeniably a lot of money, what that amount can buy in Long Beach is much greater than what it can buy in LA, where the median prices in good (not great, but good) neighborhoods are invariably over $1 million.

(Former LA residents also make up a fair amount of those who have moved into the Cliff May Ranchos in East Long Beach, causing homes to sell at over a million dollars, though the area seems to have peaked at about $1.3 million a copy lately.)

The home on Lemon Avenue that’s now in escrow, having been appraised at $1 million, is a cozy little Spanish Colonial Revival, as is typical of much of the neighborhood.

The recently restored floors, doors and trim are original hardwood and the kitchen has plenty of storage, upgraded appliances and recycled glass countertops. It’s a breezy room, with French doors opening to the backyard patio that’s surrounded by exquisite landscaping.

The home, as is the case with the historic district as a whole, has been carefully maintained and restored, just another of California Heights’ selling points.

“Everyone who is coming here is excited about living in a historic district,” said Fisher. “It’s not like Naples, where people come in, scrape the little house and put up a monster. It’s more about preservation and restoration. Everyone is excited to do that.”

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