With the start of 2018, I wanted to give you a few pieces of information to help you if you are buying or selling on the Westside. Despite disasters and a probable increase in interest rates, my 2018 real estate forecast for the Westside remains strong.
The wildfires are going to be a factor when it comes to the 2018 real estate forecast on the Westside. With housing lost to the fires, supply will go down lower than it has been, while demand will be higher.
Initially, housing will be in short supply. By the end of the year, the housing market will surge.
Prices Will Rise
The demand for houses on the Westside continues to grow. However, inventory is not keeping up with demand. In addition to homeowners keeping their homes longer, new residential development is low. Whenever you have high demand and low inventory, prices rise. The only thing that would stop it would be a market crash, but this doesn’t seem to be in the cards. In 2017, the average price for homes in LA County rose 10%. Most indicators show the Westside continuing to rise during 2018. Of course, this will depend on interest rates as well as political issues.
LA Times Hot Zip Code List
Each year, the LA Times puts together their hot zip code list. Many cities on the Westside were included:
- Santa Monica90402 – Average home price: $3,237,500
- Hermosa Beach9025 – Average home price: $1,693,500
- Marina Del Rey90292 – Average home price: $2,157,500 +23%
- Manhattan Beach90266 – Average home price: $2,100,000 +10%
- Playa Del Rey90293 – Average home price: $1,517,500 +26.5%
Do We Need To Worry About a Housing Bubble?
Some people are screaming that prices on the Westside are rising too fast and that we are about to experience another bubble. The truth is, however, that bubbles only happen when the demand for property dries up. At this time, the demand remains high. Coupled with low inventory, prices naturally rise.
In conclusion, I feel that the 2018 real estate forecast for the Westside will rival that of 2017. I expect prices to remain high. With the shortage of homes for sale, the volume may dip, especially in these first months after the wildfires.
If you have questions about the current market, my forecast, or how this affects you, please give me a call.