May 18, 2023
Gearing Up for the Start of Summer
The recent rate hikes by the Federal Reserve have had a noticeable impact on mortgage rates. As interest rates rise, mortgage rates tend to follow suit, making it more expensive for homebuyers to finance their purchases.
Unfortunately, mortgage rates have more than doubled since the Federal Reserve first raised interest rates more than a year ago to tame inflation, but that did not stop the Fed from raising the interest rate again two weeks ago. In fact, the latest quarter percentage point hike took the Fed-funds rate to a target range of 5%- 5.25%, its highest since 2007 causing yet again an uptick in mortgage rates. Despite rate changes however, we have surprisingly noticed that it has yet to make a significant impact on demand in the Los Angeles and Orange County Housing Market. In fact, homes are still fetching multiple offers with quick closes, many of which are less than 30 days.
Despite rate hikes and market volatility, our team is consistently closing transactions very quickly in a range of price points. As we approach the summer months, our team is preparing for a busy season of showcasing some amazing properties. For all your real estate needs or questions, we are here to serve you.
Why Is It So Hard To Buy A House?
The laws of supply and demand play a major factor in the real estate market. Right now there is a substantially low amount of housing inventory available. Fewer and fewer homeowners are electing to sell their homes. One of the major reasons for this is because a majority of homeowners refinanced and locked into historically low mortgage rates during the last 3 years. For someone to sell their home, they are looking at giving up their ultra-low mortgage rate and having to spend a lot more money on their replacement home.
The good news is that mortgage rates appear to have peaked (in November of 2022). They have dropped during 7 of the last 9 weeks, from 6.73% in March down to 6.35% this past week. Also, as we move into the summer months, more owners will naturally be selling their homes since it is easier logistically once the school year is over. More families typically put their homes on the market during June, July and August; additionally, there will always be residents moving out of state — to be closer to family, for job relocations, retirement, downsizing and/or tax benefits.
While there are fewer listings currently than in previous years (see this Real Trends article "From ice bath to blood bath: California struggles with inventory"), we have been helping a lot of buyers this year find and settle into new homes. A good percentage of our transactions are happening off-market and are a result of our large network of homeowners and our close relationships with other agents. If you have a specific need and location, let us know how we can help you to find your perfect home before others catch wind of it!
Stay up to date on the latest real estate trends.
August 9, 2023
Mortgage rates have seen a slight increase as of July 27. The 30-year fixed-rate mortgage now stands at 6.81%, up from last week's 6.78%. Comparatively, this time last… Read more
July 10, 2023
We are delighted to bring you some exciting highlights on the current state of the Greater Los Angeles and Orange County housing markets. As we delve into the luxury a… Read more
June 9, 2023
The residential housing market in Los Angeles and Orange County has exhibited remarkable strength, marked by high demand and limited supply. This trend shows no signs … Read more
May 18, 2023
The recent rate hikes by the Federal Reserve have had a noticeable impact on mortgage rates. As interest rates rise, mortgage rates tend to follow suit, making it more… Read more
April 21, 2023
As we enter the Spring season of 2023, we wanted to provide you with an update on the current state of the real estate market. In recent months, we have seen a steady … Read more
April 4, 2023
Spring is here and is typically a busy time for our team to prepare our sellers to list their homes on the market. Simultaneously, we have been working diligently to f… Read more
March 17, 2023
So much has happened these last two weeks in the banking sector. The collapse of two prominent banks has caused a state of panic, forcing the Federal government to mov… Read more
March 3, 2023
Torrential rains and mortgage rates hikes in Los Angeles and Orange County amidst the past several weeks didn’t stop many of our buyers and sellers from making big mov… Read more
February 14, 2023
January was a hot month where we saw buyers jumping back into their home searches as mortgage rates took a brief yet significant nose dive compared to where rates were… Read more
You’ve got questions and we can’t wait to answer them.