The Westside is hot in terms of sales prices. In fact, April numbers show that the median price of homes in Los Angeles County is at the all-time high number reached in 2007. Let’s take a look at a few of the main statistics and what these might mean for buyers and sellers.
Home Prices Rising
Home prices in LA County rose 6% from April 2016 to April 2017. This puts the median home price at $550,000. Additionally, both Orange County and San Diego County are also setting records.
The market on the Westside is similar to the national market, which is also in an upswing. Despite new home sales dropping, previously owned homes, sold faster than they have in a decade according to the Case-Shiller index.
Both Good and Bad
For homeowners on the Westside, seeing home prices rise is welcome news. Those caught in the housing bubble bust are happy to see their equity return.
On the other hand, buyers are quickly being priced out of home ownership. In general, housing prices are rising faster than incomes.
Times Have Changed
Some people worry that the high prices are going to cause another financial crisis. However, there are many differences this time. I agree with economists who cite the following:
- Poor lending practices are a thing of the past. Prior to 2007, lending practices allowed unqualified buyers to purchase homes, thus driving the upturn in real estate prices.
- The upswing in 2017 appears to be due a better job market and low mortgage rates.
- Prices have increased due to a low supply. Typically, rises triggered by a low supply are sustainable.
- Although the median price is the same as 2007, when calculating for inflation, the prices are still 12.4% below peak.
- Prices are rising steadily at 5 to 6%. In 2007, prices often rose in the double digits.
To understand how the Westside market is reacting and how it will affect your buying and selling, give me a call. I’d love to help you with all your real estate needs.