Early March 2024 California Real Estate Report

 Here's an abridged summary of CAR's market data report:

March 4, 2024 – Recent economic reports suggest that inflation continues to cool from last year but may remain sticky in the short term. ... While it is widely expected that the Federal Reserve will not cut its policy rate in its upcoming meeting, mortgage rates could begin to trend down more meaningfully towards the end of the second quarter if the economy continues to slow.    

 

Consumer confidence slips for the first time in three months: Consumers’ attitude towards the economy took a step back in February, as the Conference Board’s Consumer Index fell 4.2 points to 106.7 last month, declining for the first time since November of last year. ... Recent rising trend in interest rates could have affected how Americans feel about the economy as well, and concerns over the U.S. political environment may also have been a contributing factor to the decline in the optimism.    

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Mortgage rates remain elevated after key inflation data: The average 30-year fixed rate mortgage (FRM) reported by Freddie Mac for the week ending February 28 climbed again for the fourth consecutive week to the highest level since mid-December of last year. ... The Fed wants to see more evidence that inflation is slowing consistently and could wait until the second half of the year before making any rate cuts. Mortgage rates, as a result, could remain elevated at the start of the homebuying season. 

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Income edges up but inflation-adjusted spending dips: Americans were making more in January but may not be spending more after accounting for inflation. Personal income growth jumped 1% on a month-over-month basis and recorded the highest increase since July 2021. ... With the core PCE deflator notching its biggest monthly gain in 12 months, real consumer spending, in fact, declined 0.1%, the lowest since August of last year. 

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Construction spending unexpectedly falls in January: Construction spending in the U.S. started off the year slow with total outlays declining on a month-to-month basis by 0.2% in January, its first drop in 13 months. ... With vacancy rate likely to climb as more new apartments are expected to be released this year, multifamily construction should pull back further in the next 12 months.

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Mortgage delinquency holds steady near historic lows: Mortgage delinquency inched up at the end of 2023 but remained near record low levels, according to a recent report from CoreLogic. Mortgage borrowers who were late in making their payments by at least 30 days or more accounted for 3.1% of all outstanding mortgages in December, an increase of 0.1 percentage point from 3.0% recorded in December 2022. ... With home prices projected to increase in 2024 and the economy likely to experience a mild growth this year, delinquency rate could rise but is not expected to increase sharply in the next 12 months.

 

Spring is coming and so is it time to seriously think about your real estate plans for this year?

 

Julia Huntsman, REALTOR, Broker | http://www.abodes.realestate | 562-896-2609 | California Lic. #01188996

Colors Make a Difference When Selling a Home

Many times a property owner loves their colors, that deep purple wall in the living room is such a nice contrast to a golden orange kitchen.  And in some countries, bright colors or very deep colors are seen as desirable, so sellers need to work at what the buyer sees when viewing their home. The fewer the personal elements, the easier for the buyer to make the house his, or hers.  It may be difficult to achieve perfection in staging to sell, but usually paint, at least in the main entry areas and living room, is achievable for most people.

Color definitely has an impact on the feeling a prospective buyer may have about a home. Colors that are a personal reflection of the owner's taste may be seen as an additional expense to paint out for the buyer--and may even be a hurdle to getting an offer.  A large house with a strong forest green exterior was one the market in my area for the entire listing period, and never sold, even though an estimate was obtained for the buyer (multi-thousands of dollars to paint out). So the effect of color cannot be underestimated for most buyers, it's either difficult to look past and reimagine the home, and/or it's seen as another expense to fix.

So what do professionals, and agents, recommend?  Neutral colors. Warm neutral colors as opposed to cool neutral colors.  While certain gray colors are currently often seen in flooring and other interior features, they are usually on the cool side.  The owner should strive for a feeling of warmth according to a majority of 71 professionals surveyed.

Exterior colors may have the same effect.

However, in some areas such as Long Beach that have historic districts guiding the exterior home design, darker colors may prevail and be acceptable due to historic considerations. The era of the home can be the owner's guide in many cases.

For more on this topic, go to https://www.fixr.com/articles/paint-color-trends-2024#colors-for-selling-a-home-in-2024

Julia Huntsman, REALTOR, Broker | http://www.abodes.realestate | 562-896-2609 | California Lic. #01188996

January 2024 Market Report for Long Beach and Los Angeles County

LA County and Long Beach Housing Data, Jan. 2024

 Sales growth for Long Beach in January was down by 5%, while the median price climbed upward another 8% to $886,000.

Median price for all of Los Angles County was $925,000, also an increase by 8%.

Look at other cities: Similar median price but far fewer sales, such as Hawthorne, West Covina,, Claremont and San Dimas. 

 So one of the things this chart shows is that Long Beach is more active than other cities: housing variety, larger city, range of prices.

Sales over list price: in Long Beach in January, 49% of sales were over list price, for Los Angeles County it was 39% of sales were over list price.

(This is an interactive chart, display is a screenshot only.  I would be happy to forward the link upon request, it covers all counties and most cities in California.)

NOTE:  The graph at the right shows average home price for Long Beach for February 2024 was $1,086,764, and increase of  11.1%; the median home price in February was $925,000, an increase of 5.7% (compare to January median price of $886,000).

Julia Huntsman, REALTOR, Broker | http://www.abodes.realestate | 562-896-2609 | California Lic. #01188996

California Continues Upward Price Increase -- See Comparisons

 

Current graph on Calif home price in 2024

 In spite of fluctuating rates, going down, the back up, demand is high and supply is low. Recent data provided by CAR economist Jordan Levine this last week and NAR, shows that currently 32% of home sales are all cash, back to where we were a few years ago. So 1/3 of buyers are not concerned with mortgage interest rates.  The current California home price is $788,940, and the number of single family active listings was 29,000 in January, down from 32,000 in January 2023. And, we are at the lowest level of mortgage applications in the last 30 years!

Why is buyer demand so low right now, when the U.S. unemployment rate is at 3.6%?  Is someone telling you as a buyer it's better to wait because interest rates will be coming down even lower? That is very unlikely to happen.. 

Interest rate data forecast

Typically, the gap between the 10-year Treasury yield and the 30-year fixed mortgage rate spans 1.5 to 2 percentage points. For much of 2023, that margin grew to 3 percentage points, making mortgages more expensive. - Bankrate.com

 Click on this link to use the Purchasing Power Calculator, which provides multiple comparisons for the buyer's location and financial situation :  http://www.car.org/marketdata/interactive/interestrateaffordability

We all remember the extremely low interest rates in the 3% range during Pandemic housing market, and how that coincidentally pushed prices up in bidding wars. It's still a competitive market, but as more listings come on the market in 2024, there is hope that buyers will have a better playing field.

 

Julia Huntsman, REALTOR, Broker | http://www.abodes.realestate | 562-896-2609 | California Lic. #01188996

Bay Area vs Kansas City Price Comparison

San Francisco and Kansas City home market prices!

This graphic is at the end of 2023, showing median sales prices as of the 4th quarter in the Bay Area vs Kansas City.

If anyone is thinking of relocating to Kansas City or any other area, just get in touch!

 

Julia Huntsman, REALTOR, Broker | http://www.abodes.realestate | 562-896-2609 | California Lic. #01188996

Cash Transactions May Soon Require Reporting by the Broker

"The Treasury Department’s Financial Crimes Enforcement Network proposed a regulation on Wednesday that would require real estate professionals to report information to the agency about non-financed sales of residential real estate to legal entities, trusts and shell companies."

Cash transactions in real estate have been a suspected source of money laundering, both in the United States and Canada, where values have increased over 3-7%. Not everyone is happy about being registered, but a new database has been set up where over 100,000 business have registered, in order to gain transparency for who is buying with all cash in real estate purchases. Anonymous shell companies and trusts will have to disclose names of actual persons involved.  See more at the Wall Street  Journal.

Julia Huntsman, REALTOR, Broker | http://www.abodes.realestate | 562-896-2609 | California Lic. #01188996

The Market in Seal Beach for December 2023.

Seal Beach Market Update Dec. 2023

Seal Beach visitors notice the shops, restaurants and local neighborhood ambience.  Old Town is the center of summertime activity for beach going fun and walks on the pier. It's hometown scale is what visitors find accessible and friendly. 

Listings for single family homes in Seal Beach were down in December 2023, as were the number of closed sales, compared to one year ago, 96 sales down to 77 sales, while days on market increased from 20 days to 30 days.  The median price however, over the previous 12 months, increased by 3.7%, while average prices were down 1.2%.

To see map and or list views of current properties on the market, go to the link below, fill out the form and click on Apply.

 

Here is map view of current properties on the market in Seal Beach as of date of this post:

 

Graphic of current listings in Seal Beach

 

 

 

 

 

To find properties in Seal Beach, go to https://www.abodes.realestate/mls-property-search 

 

For more information on any properties, please call, text or email me. The more information you give me, the more I can assist you.

Julia Huntsman, REALTOR, Broker | http://www.abodes.realestate | 562-896-2609 | California Lic. #01188996

8 Eye-Opening Things Home Inspectors Can’t Tell You

What’s included in a home inspection may not be as important as what isn’t.

A home inspection may feel like a final exam, but it’s not quite so clear cut. Your inspector’s report won’t include a clear-cut  A+ if a house is a keeper or an F if it’s a money pit.

What is included in a home inspection report is a set of neutral facts intended to help you decide on a home’s final grade.

Oh sure, a seasoned inspector will know if a home is a safe bet or full of red flags. But they’re actually bound by a set of rules that limit what they can tell you.

Here’s what they can’t say:

#1 Whether They Would Buy This House

Here’s the big one: Many buyers think an inspector will give them a thumbs up or thumbs down, but they can’t. Giving real estate advice violates the International Association of Certified Home Inspectors’ code of ethics.

Clues to look for: Count up your issues. “The average inspection turns up around 20,” says Larry Fowler, a home inspector in Knoxville, Tenn., who has done around 10,000 home inspections in his 22 years in the business. “If there are more than 30 items, you may have a bad house,” Fowler adds. “If there are fewer than 10 items on the list, you may have a bad inspector.”

The bottom line is that every house and buyer are unique and what inspection results one person is fine with, another may not be. Confer with your agent once you have the report.

#2 If It Has Termites, Rats, or Mold

Yikes! You might assume this trio of homewreckers would be part of every house inspection checklist, but your inspector isn’t licensed to look for them.

Clues to look for: Inspectors can note that those sagging floors are evidence of termites, or that shredded insulation is evidence of rats, or the black stuff on the walls is evidence of fungal growth. To turn evidence into proof, ask a specialist for a follow-up inspection.

#3 If the Pool or Septic System Are in Good, Working Order

Home inspectors aren’t certified to inspect everything that could appear in any home. So for example, if there’s a pool, some may turn on the pool pump and heater to make sure they work, but they won’t look for cracks or plumbing leaks. You’ll need to find a pool inspector. In other cases, you may need a septic systems or wells expert, an asbestos or radon specialist, etc.

Clues to look for: Any special feature is your cue to find a specialist. “We’re general practitioners,” Fowler says.

And here’s a bonus tip: Consider a home’s advanced age a “special feature,” as they’re likely candidates for lead paint, asbestos, and other old-home hazards.

#4 That They’re Making The House Look Worse Than It Is

Some inspectors make note of every tiny thing in a house, even inconsequential ones. Like chipped paint. Scratched windows. Surface mold in a shower. These folks are sometimes known as deal killers.

Clues to look for: If your inspector’s report is pages long and full of items that won’t hurt the value of the home, it’s probably not a big deal. Sit down with your agent, and go through the report to determine which (if any) issues could affect your offer.

Note: See sample inspection reports from around the country at the International Association of Certified Home Inspectors website.

#5 If That Outlet Behind the Couch Actually Works

An inspector can only check what they can see without moving anything. This means the foundation could be cracked behind that wood paneling in the basement. Or the electrical outlet behind the sofa might not work.

Clues to look for: The inspector should note if they’re unable to inspect something critical. Consult with your agent about what to do, such as asking the seller to take down the paneling or offering to pay to have it removed. Alternately, offer a lower price.

#6 Whether They’ve Inspected the Roof Closely

Some inspectors will climb up on the roof to look closely at shingles and gutters — but they’re not required to. If it’s raining or icy, or the roof is steep or more than two stories high, they can stay on the ground and report what they can see from there.

Clues to look for: They should note whether they walked the roof, but if it’s not clear, ask. If they haven’t, keep this in mind when evaluating their roof inspection report. They should still note any missing or damaged gutters or downspouts and the general condition of the roof based on what they can see from the ground.

#7 What You Should Freak Out About (or Not)

It’s an inspector’s job to find things wrong with the house. Big things, little things, all the things. It’s not their job to categorize them as NBD or OMG. A checkmark next to a crumbling foundation will look the same as a checkmark next to chipped paint.

A few things you may find on an inspector’s report that aren’t a big deal:

• Condensation in a basement or crawl space
• Early signs of wood rot on trim
• Cracks in bricks from the house settling
• Faux stone siding that’s been improperly installed
• Radon levels below 4 pCi/L

These items, however, could trip your freak-out response (if you’re not prepared to address them):

• Standing water in a basement or crawl space
• HVAC not working
• Outdated wiring, especially knob-and-tube wiring or aluminum wiring
• Wood rot
• Old plumbing pipes
• Radon levels above 4 pCi/L

#8 Who They’d Recommend to Fix It (and How Much It Will Cost)

Your inspector may seem like the perfect source of insider info on repairing issues they see all the time, but the opposite is actually true.

You don’t want your inspector to make financial decisions based on their report. Think about it: If an inspector’s buddy Steve gets a plumbing gig every time a certain issue turns up on a report, it gives that inspector some pretty big (and not cool) motivations to find that issue.

Even giving you a price range for the repair is off-limits. It’s not their area of expertise, it creates a conflict of interest (they could be endorsing Steve’s great deal, after all), and, perhaps most importantly, it’s against the ethics rules.

Clues to look for: This is good home ownership practice. Try to price out every item on your home inspector’s report, big and small. Do some research, and call three contractors or check out three retailers for the service or part needed to resolve each issue. You’ve got this, future homeowner!

 This and other helpful articles are on HouseLogic.  Find more information, and a list of member home inspectors, at https://www.creia.org/resources-for-home-owners-realtors.

Julia Huntsman, REALTOR, Broker | http://www.abodes.realestate | 562-896-2609 | California Lic. #01188996

Costs of Owning a Home Include Utility Bills

Sales price of a property is not all there is to consider in a home purchase -- there are maintenance, insurance, property taxes, and utility bills. Utility bills may include water, central air and heat, phone and internet services, and keeping up the heat for the swimming pool if there is one. If your property is a condo or single family home in an HOA, monthly assessments may include some services, or not -- so a buyer should be sure to check on those items.

With the topic of climate change, heating and cooling costs have particularly come to owners' attention. But according to a survey by Payless Power, only about 47% of homeowners said they considered cost of electricity when purchasing their home. While this can vary widely according to living in a cold winter blast area, or the hot summer deserts of Arizona and California, agencies have increased their utility charges. 

To conserve costs, consider using off-peak hours (check with your utility company, usually later in the evening), using energy efficient appliances and unplug them while you're on vacation, and sealing the house as cracks and gaps can account for a 40% loss of heat--dual paned windows are not inexpensive but can be worth the cost.

The graphic by Payless Power illustrates some of their findings on costs related to age of home, size and type.

 

Julia Huntsman, REALTOR, Broker | http://www.abodes.realestate | 562-896-2609 | California Lic. #01188996

Owner/Tenant Updates for California in 2024

Roommates moving in to new unit

The following is meant as a summary, not an in depth explanation of current updates (provided courtesy of California Association of REALTORS), to the Tenant Protection Act.  A real estate attorney or property manager, if you have one, should be consulted if you have questions about your particular situation.  It's really advisable to do so anyway, since in California tenant/owner laws are sometimes complex, and vary from county to county, and city to city:

    

     Beginning July 1, 2024,landlords may collect no more than one month’s rent for either furnished or unfurnished units in addition to first month’s rent. There is an exception for small landlords, defined as a landlord who is a natural person or LLC and owns no more than two residential rental properties with no more than a total of four units offered for rent. 

     Tenant Protection Act law tightens up the requirements for a landlord to terminate a tenancy under the Tenant Protection Act (i.e., California statewide rent cap and just cause eviction law) for no-fault evictions based upon owner move-in or substantial remodeling.  Additionally, an owner who violates the TPA by improperly terminating a tenancy or by raising rent beyond the maximum amount is liable for actual damages, reasonable attorney’s fees and costs (at the discretion of the judge), up to three times actual damages for willful violations and punitive damages. The Attorney General et al is authorized to seek injunctive relief. Effective April 1, 2024. 

    Prohibits local ordinances that penalize tenants and landlords for various types of law enforcement contacts, i.e., local “crime free” rental housing programs and ordinances. 

    Landlord must offer “ability to pay” in lieu of reliance on credit history and reports in assessing a tenant’s rental application when prospective tenant is receiving a government rent subsidy such as a Section 8 rental voucher.

    Allows a jurisdiction with local rent control to require an owner of a rent-controlled unit to allow a tenant with a permanent physical disability to relocate to an available comparable or smaller unit located on an accessible floor of the property and retain their same rental rate. 

     SB 712 prohibits a landlord from prohibiting a tenant from owning personal micromobility devices or from storing and recharging up to one personal micromobility (e.g., e-bike) device in their dwelling unit for each person occupying the unit, subject to certain conditions and exceptions.   

    This law tightens up the requirements for a landlord to terminate a tenancy under the Tenant Protection Act (i.e., California statewide rent cap and just cause eviction law) for no-fault evictions based upon owner move-in or substantial remodeling.  Additionally, an owner who violates the TPA by improperly terminating a tenancy or by raising rent beyond the maximum amount is liable for actual damages, reasonable attorney’s fees and costs (at the discretion of the judge), up to three times actual damages for willful violations and punitive damages. The Attorney General et al is authorized to seek injunctive relief. Effective April 1, 2024. 

Julia Huntsman, REALTOR, Broker | http://www.abodes.realestate | 562-896-2609 | California Lic. #01188996