The market is picking up steam as the more active Spring and Summer months are just around the corner. Sales of existing single-family homes had another year over year decline due to a decrease in both supply and demand. Compared to the month previous, California home sales creeped up for the second straight month in a row as homebuyers took advantage of lower interest rates. Many are concerned of a market crash with respect to prices but we are only seeing a moderate decline off the highs of June 2022. In fact, signed contracts to buy existing homes in the U.S. rose in January in the largest monthly increase since June 2020. Low inventory levels are definitely helping to support prices with L.A. County home prices down only 2.6% month over month. Although inflation seemed to have been tapering off, new fears of inflation not decreasing quick enough is sending panic in the stock market with the NASDAQ up only .64% for the month, down from its high when it was up 6% for the month. Review our Buyers and Sellers ADVICE section to best position yourself in this transitioning market. Please continue sending us topics of interest so we can cover them in future newsletters. Thank you for reading!
Dennis Adelpour and The Adelpour Group
Sellers with homes that are well-priced and well-marketed are going to see the best return and the highest and best offers during the first few weeks when the home is on the market. Pricing realistically in this market is incredibly important.
We have been dealing with many sellers who are ready to make the move but are concerned if the inventory will be there to purchase once they sell. In this market, buyers are willing to make adjustments to their timeline to allow sellers to find their next home so solutions are available for sellers.
Sellers who own properties in excess of $5M value, please be aware of measure ULA. With measure ULA passed in November, sales of residential and commercial real property valued at over $5 million but less than $10 million would be subject to an additional tax at the rate of 4%, while sales of properties valued at $10 million or more would be subject to an additional tax of 5.5%. The new tax would apply to the entirety of the sale value, not solely the amount in excess of the $5 million and $10 million thresholds. The tax would apply to property sales occurring on or after April 1, 2023.
Rates took a nice dip during the last few months but they are slowly starting to creep back up. Many buyers are still trying to time the market, not knowing there are properties sitting on the market that can be purchased at a great discount! For the buyers looking at the hotter, more in demand markets, we are still seeing multiple offer scenarios. If you are looking in an area with this market condition, you are not up against 20 other offers as seen in the past, but with the limited inventory, the best homes priced accordingly to the market are many times still seeing multiple offers.
Check out the recent Redfin article we were featured in:
Build-To-Rent Homes: What You Need to Know About the Future of Single-Family Rentals
Build-to-rent (BTR) homes are ideal for people who want the benefits of community living without the hassle of maintenance, mortgage payments, or HOA dues. In recent years, the movement to create more of these types of homes has been increasing due to higher demand. Because of its rapid growth, many real estate companies and investors are developing BTR properties to capitalize on the craze.