October/November Prices in Long Beach, Lakewood, Cerritos, Seal Beach

Happy December in Long Beach

In Los Angeles County, the median priced home in October, 2016 was $570,000 , up from $510,000 in October, 2015.

The current median single family home price is $513,520 for all of California, an increase of 7.3% statewide since the previous October. 

In the chart are median prices (the midpoint of all sales above and below that price) for Long Beach, Lakewood , Cerritos and Seal Beach single family homes from January 1, 2015 through December 13, 2016.  Seal Beach has decreased by 1.5% in that time; Cerritos has increased by 5%;  Lakewood has increased over 9% overall; Long Beach has increased 11%.


Current average price for a single family home - Long Beach $673,500; Cerritos - $706,453; Lakewood $5554,872; Seal Beach $951,544.
Average 2-bedroom condominium prices for all four cities range from $328,000 (Cerritos) to $391,000 (Long Beach). 

See the July post for prices

Key 2016 Remodeling Trends for the Los Angeles/Orange Counties Area--What is Cost vs. Value?

  The annual report is out on home remodel cost vs. value, conducted by Remodeling Magazine.  This is a valuable survey every year because the statistics vary according to the market and according to the region.  Return on projects were somewhat higher in the boom years, over 60%, and then fell under the 60% mark when the market declined.

Projects also vary in perceived value-- topping the list for 2016 was entry door replacement, especially into fiberglass doors.  Second story additions, master suites and kitchen remodels all increased this year in value, according to the real estate professionals in this survey.

Fiberglass insulation projects have been added for the first time to this report, a project not measured on an annual basis, but on a return extending over many years.  This project is estimated to give more than 100% return.

"In contrast, the five projects with the worst returns all scored cost-value ratios between 56.2% and 57.7%. From the bottom up, they are: midrange bathroom addition, upscale bathroom addition, upscale master suite, upscale bathroom remodel, and composite deck addition,"  according to the Remodeling 2016 Cost vs. Value Report (www.costvsvalue.com)  So not all upscale projects give the best return, and for some reason, neither do composite deck additions in this report.  Having seen enough termite damaged wood decks, composite decks would seen to be a great improvement in Southern California, but in this report, wood decks fare more favorably.

Replacements projects netted a few percentage points higher in return, 61%, compared to remodel projects which came out around 57%.

See the complete report online at Remodeling.
A free downloadable pdf report is also available online.

Where Is The Lowest Homeownership Rate in the Nation?

According to the U.S. Census Bureau, the lowest homeownership rate in the nation is right here in Southern California:  Los Angeles and Orange Counties.  In the second quarter of 2016, this region had 46.5% of residents living in a home they owned.  That's down from 49% and 48% from prior quarters.

According to First Tuesday Journal, the peak rate of 60.7% was reached in 2006, and the current 46.5% is well below California's historical average of about 55% homeownership rate--although bear in mind the low point was at 43.4% in 1940.  Today's California home prices have exceeded average incomes, and even though mortgage rates are still historically low at today's 4%, future rise in mortgage rates will help that rate continue to languish.

Mortgage rates which have operated in cyclical fashion according to the Fed's decisions about the national economy, plus the lingering effects of past bankruptcies and foreclosures on displaced homeowners, and the return of California's employment levels all have an effect on housing in this state.  An ongoing debate remains about whether young adults of the "millennial" generation are motivated to become homeowners, or not.  

One misperception among many hopeful buyers is that a 20% down payment must be obtained in order to buy -- that's false -- along with a lack of knowledge about financing options in general; another issue for many younger adults is the lack of savings combined with a higher rate of personal spending which prevents some from saving enough for a low-down-payment loan, such as a 3.5% FHA loan, and necessary closing costs.  Keeping credit scores in good shape, and understanding debt effects (i.e., keep debt on credit cards low, low, low), may do a lot to help offset impacts from necessary debt. 

For more information on facts of buying, please contact me!