LA home values down 1.3%

What’s interesting about most data reports is that they are 1 - 2 months behind. For example, the S&P Case-Shiller Home Price Index that was released today discusses sales data for February. There is no mention of what the market has been going through in March and April.

I can personally tell you that in April we are seeing multiple offers on well priced properties. In many cases homes are selling well above asking price. I would imagine that when the April Home Price Index report comes out in 2 months, it will show that the 1.3% price drop experienced in February will be a thing of the past and the numbers will turn positive. I could be wrong, but I doubt it based on what I am seeing.

Here is some data from today’s S&P Case-Shiller Home Price Index report:

Miami’s 10.8% year-over-year gain made it the best-performing city for the seventh consecutive month. Tampa (+7.7%) and Atlanta (+6.6%) continued in second and third place, with Charlotte (+6.0%) close behind.

Results were different in the Pacific and Mountain time zones. Last month, four West Coast cities (San Francisco, Seattle, San Diego, and Portland) were in negative year-over-year territory. In February they were joined by four of their western neighbors, as Las Vegas (-2.6%), Phoenix (-2.1%), Los Angeles (-1.3%), and Denver (-1.2%) all tipped into negative territory.

Majority of potential homebuyers say they will not accept a mortgage rate over 5.5%

Today’s homebuyers are exceptionally sensitive to mortgage rates with house prices so high — and they’ve found their tipping point.

The majority of potential homebuyers, 71%, say they will not accept a 30-year fixed mortgage rate over 5.5%, according to a survey done in March by John Burns Research and Consulting. The current rate, however, is around 6.4%.

If so many potential buyers, however, are saying they won’t buy unless they get a rate below 5.5%, they may be sitting on the sidelines for a while. Mortgage rates have been over 6% for nearly a year and are not expected to move much lower this year.

An April survey from U.S. News and World Report seems to corroborate these findings: It found that 66% of Americans who plan to buy a home this year said they are waiting until rates fall.

The U.S. News survey also found that 25% of homebuyers who are holding out for lower rates are waiting until they drop below 5%. Nearly two-thirds of respondents said they’ve had to reduce their housing budgets due to the current level of mortgage rates.

CA is giving you 20% for your home's down payment... but there's a catch!

A new state program just launched for first-time homebuyers. The California Dream For All program provides homebuyers with financial assistance equal to 20% of a home’s purchase price. Those funds can be used for a downpayment and closing costs when purchasing your first home. The program offers first-time homebuyers in California a shared appreciation loan of up to 20% of the cost of the home. If you’re buying a $500,000 home, you’d receive 20%, or $100,000, to help with a downpayment and closing costs. Once the homebuyer sells their home at a later date, they would be required to pay back the 20% assistance, plus 20% of the home’s appreciation. If your $500,000 home sells in five years for $700,000, you’d owe 20% of $200,000 appreciation — or $40,000 — in addition to the original loan. If you sell your home and it hasn’t grown in value, you’d only pay back the original 20% loan, according to the California Housing Finance Authority,

This program is open to first-time homebuyers in California — meaning you’ve never owned a home. A first-time homebuyer is also someone who owned a home three or more years ago and sold it, according to the CalHFA. Borrowers must also plan to live in the new property they are buying. The program does not allow for non-occupant co-borrowers or co-signers. In addition to being a first-time homebuyer, borrowers must meet income requirements depending on their county. In Los Angeles County, borrowers must make under $180,000 per year.

Better hurry! The state has allocated about $300 million toward the California Dream For All program, according to State Treasurer Fiona Ma. This will provide assistance for an estimated 2,300 homebuyers in California.

Source: NBC 4 Los Angeles

The new "mansion tax" that starts Saturday is now projected to bring in 25% less than original estimates advertised to voters in November.

This past November, Los Angeles voters backed Measure ULA, a transfer tax on big-ticket property sales that the city says will generate a new revenue stream for affordable housing projects and homelessness prevention. Known as the “mansion tax,” Measure ULA will impose a 4 percent tax on property sales above $5 million and a 5.5 percent tax on properties above the $10 million mark. The tax must be paid by the seller.

The City of Los Angeles now expects to make a lot less from its new transfer taxes than originally advertised.

Measure ULA is projected to generate up to $672 million in revenues from July 1 of this year through June 30 of next year, according to an analysis from the City Administrative Office, which conducts financial and budget analyses. The office released its report 2 weeks ago.

The new numbers are about 25 percent less than original estimates provided to voters in November, assuming about $5.1 billion less in property sales.

US home sales surged in February as mortgage rates dipped

Sales of previously occupied U.S. homes surged in February to the fastest pace in six months as homebuyers seized on a modest drop in mortgage rates.

Existing home sales jumped 14.5% last month from January to a seasonally adjusted annual rate of 4.58 million, the National Association of Realtors said Tuesday.

The surge in sales — the biggest on records going back to 1999 — ended a 12-month slide that knocked the nation’s housing market into its deepest slump in nearly a decade and left sales in January at the slowest pace in more than a dozen years.

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For the general location of this off market property, in Google maps, put in "Riverside Dr. and Fletcher Dr."

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This multi-level home has 4 bed/4 baths, 3,214 sq. ft. of living space, and the lot is 2,465 sq ft.

The new construction home features an open living, dining, and kitchen area, and the primary suite is on the top floor with a fireplace, walk-in closet, and access to the backyard area.

Luxury home sales drop, prices go up

Deals estimated to be in the top 5% in a market on average dropped 44.6% year-over-year for the three-month period ending Jan. 31, according to Redfin. That’s the largest annual decline and the second-lowest level on record.

Miami’s luxury market took the biggest hit in the three-month period, with a year-over-year decrease of 68.7%. That was followed by Long Island (62.8%) and three California markets: Riverside (59.8%), Anaheim (59.3%), and San Jose (59%).

Los Angeles came in at a 55.5% decrease.

That lack of supply has pushed luxury home prices higher. The median price in the US was up 9% compared with the same period the year before.

Home sellers are now seeing 5, 12, even 20 offers

Last year around this time it was not unusual to see 30 offers for one property. That is not an exaggeration. Then interest rates went up and buyers got scared. In the 4th quarter of 2022, a home on the market was lucky to get 1 offer.

Today, buyers have accepted the higher rates and are actively looking to buy.

I can now report that homes that are priced at market value and are in a decent location are seeing multiple offers again. I have first-hand knowledge of homes in and around the San Fernando Valley that are getting 5, 12, or even 20 offers.

The homes that are overpriced or in a bad location are sitting on the market. Some will point to those homes and say the market is tanking. If you believe the market is tanking then you are not in the real estate trenches.