What the Richcession Means for the Housing Market

January 13, 2023

What the Richcession Means for the Housing Market

What the Richcession Means for the Housing Market

A new year opens the door to new opportunities but it is still too early to determine what exactly will happen in the real estate market as we inch towards the Spring season. 

Inventory still remains low in LA and Orange County, but it is clearly evident that home prices across Southern California are slipping as a result of higher mortgage rates. So Cal home sales during the fourth quarter of 2022 according to CoreLogic fell to 13,016 units in November— a 44% drop in transaction compared to the same time the year prior. 

With that said, we are seeing all sorts of creative moves from both sellers and buyers to make the sales process as smooth for both sides as possible— from seller financing options to longer escrows for buyers to have more breathing room to make the most informed decisions for themselves are just some of the many ways deals are getting done. 

We are also seeing different banks offer attractive lending programs to make the numbers work for home buyers which has resulted in a boost of confidence for both sellers and buyers.  

What We're Reading

There is a lot of talk about the current recession and its impact on the jobs market and the housing market. In fact, there is a term being tossed around recently called the "Richcession" to suggest that the wealthiest are affected much more this time than the middle- and lower-class. One example is that unemployment numbers have improved overall despite there being layoffs at many of the large technology companies such as Meta, Twitter and Salesforce. In addition, the stock market has taken a tumble in recent months which directly impacts the wealthiest individuals more than anyone else. As a result, housing at the higher end may slow down as these individuals decide to wait it out during these times of uncertainty. However, those below the wealthiest class may sense more job stability and confidence in the economy, thus enabling them to buy or sell homes with much more confidence and ease. The article on Richcession by WSJ can be found here.

Read Our January Newsletter Here


Recent Blog Posts

Stay up to date on the latest real estate trends.

Optimism is in the Air

February 5, 2024

The outlook for the 2024 housing market can probably be characterized in one word: Optimism. We are starting to see a lot more optimism this year already, coming out o… Read more

New Year, New Beginnings

January 20, 2024

As we embrace 2024, it's a time for new beginnings, and the real estate landscape in Los Angeles and Orange County is no exception. We're thrilled to share that the ho… Read more

Navigating the Current Mortgage Landscape: Rates, Trends, and Year-End Opportunities

December 20, 2023

As we approach the end of the year, we find ourselves amidst a dynamic real estate landscape, with mortgage rates taking center stage in the recent weeks. Here's a qui… Read more

Busy This Time of Year

October 31, 2023

Fall has arrived, and with it comes a noticeable softening in the real estate market. However, this change has brought forth some interesting dynamics that both buyers… Read more

A Slowdown in the Housing Market

September 29, 2023

As we step into the current landscape of the real estate market, it's evident that things have slowed down, with prospective buyers showing caution in the face of clim… Read more

Real Estate Market Update - 08/08/2023

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

The Market Momentum This Summer

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

A Strong Start in Summer Sales

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

Gearing Up for the Start of Summer

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

Let's Talk

You’ve got questions and we can’t wait to answer them.