Snapshot of Single Family Home Market in Los Angeles County and Long Beach - March 2023

The Los Angeles County update for

Los Angeles County Market Update

March 2023.
 

Median Price for Single Family home: $718,370

Home Sales are Down - 30%

Unsold Inventory - 2.2 Months down 22%

Median Time on Market - 19 days

 

 

 

 

 

 

 

 

Long Beach Market for March 2023

Long Beach Market Update

Median Price for Single Family Home $916,000 - Increase over 2%

 Home Sales are Down - 35%

 Active Listings  Down - 21%

 Median Days on Market - 12 days

 Sales to List Price - 100%

 Active Listings w/ Reduced Prices - 30.4%

 Overall, time on market continues to drop, and supply is tight as new listings decline from last year.

California's 50 of 51 counties experienced a sales drop compared to a year ago, with 35 counties dropping more than 30% in sales volume, with weather having a major impact.  Median price statewide for March was $791,490, compared to the $851,130 median price for March of 2022. California Association of Realtors reports:

"California’s median home price grew for the first time in seven months in March, increasing 7.6 percent from February’s $735,480 to $791,490. March’s price also was lower on a year-over-year basis for the fifth consecutive month, declining 7.0 percent from the revised $851,130 recorded last March. With home prices rising more sharply than the normal seasonal pattern last year, the market could see larger year-over-year price drops as it moves through the spring home-buying season."

Even with interest rates higher than last year, prices locally in Long Beach remain strong, while inventory is low and buyers are still competing with each other. If you would like to get an estimate of value for your home, please contact me. Getting a home estimate is a good planning tool, even if you are not sure you're selling right away.  While there are online estimates of value available, automated valuation systems do not select for certain property features, and may vary greatly with one another. Ask a professional.

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

No "Mansion Tax" in Long Beach, A City of Beautiful Homes

The City of Long Beach has many fine homes in the luxury category currently on the market. If you're looking for historic or a more contemporary style, water views or not, Long Beach has much to offer.

View of Downtown Long Beach

And, unlike the City of Los Angeles, there is no "mansion tax" (Measure ULA) such as the one effective April 1 which adds thousands of dollars in the form of a 4% transfer tax for sales above $5,000,000. According to this Los Angeles Time article, the market over $5,000,000 has slowed considerably since then, not generating the planned funds for housing for homelessness.

 

To search homes available as of May 5, 2023 over $2,000,000 in the area, look at these Long Beach opportunities to buy in Naples, Park Estates (listing designed by Lloyd Wright), Belmont Heights, Alamitos Heights, and Virginia Country Club.  For buyer representation, contact me on any property of interest.

In the Long Beach market in the last 6 months there were 21 sales of single family homes between $2,000,000 and $4,000,000, and currently, in the same price range, there are 27 single family homes in escrow or actively listed on the market.  Although properties in the past have sold well over $5,000,000, currently the market is under $5,000,000, a good opportunity for the luxury home buyer.

Naples home, water view

Take advantage of this opportunity now! By using the search function on the link above, a buyer may change the criteria for any price range and type of property for many cities in the Southern California market.   

 

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

Changes in the Single Family Home Long Beach Market in 2023

December 2021, April, 2022 and December 2022

Long Beach Market Graphic 2021-2022 - Single Family

  

Long Beach Market March 2023 - Single Family

Buyers and sellers alike felt the shift in interest rates in the summer of 2022 -- buyers were driven out of their desired price range into a lower priced market which was more competitive, and some buyers were discouraged altogether by qualification issues.

In comparing the 2021-2022 graph for December 2021, April 2022 (just before rates started to climb) and December 2022, certain things stand out.  The number of closed sales decreased by 46%, and the number of listings, already low for available buyers, dropped even lower by 17%.  By December 2022, the median sales price dropped over 7% to $839,000 and the average sales price dropped to $894,176, a decrease of over 12%. Pending sales dropped over 53% compared to the previous December. The months supply of inventory showed an increase by December, but still quite low by historical standards, but in actual numbers of homes for sale, the inventory increased 40% by December, 2022.  Note that April's median and average sales prices were over $1,000,000  before dropping to December's level. 

However, by March, 2023 the median and averages sales prices have increased to $899,000 and $982,386, but not up to the high in April 2022, while months supply has increased to 1.6 month -- higher than 2022 figures. Days on market has also increased to 33 days in March - a far cry from the 7-day average frenzy during the Pandemic with its super-low interest rates. Pending sales in March 2023 also increased from December 2022, a sign of more buyers in the market.

It's a time for seller's to be realistic on prices, even though there is a continuing demand for inventory, and competitive bids. While qualified buyers are able to buy in the higher priced market, they expect value for their money.

For a qualified Realtor's estimate of home value, please contact me.  I've been serving sellers since 1994 in residential property in the Long Beach and surrounding areas.

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

Appraisals -- What Do You Know About Them?

Sellers have been in a multiple offer market again this year, with buyers getting the "Buy Now" feeling in order to get  a home. But buyers nevertheless want a good value, and appearance, condition and location are still extremely important.  That all goes into value for the buyer.

So sellers, pricing your property for sale goes hand-in-hand with preparing your property for sale, which ultimately can affect the perceived value and thus, the sold price, of the property. 

So how does a seller decide on the right list and sale price? Your Realtor should explain transactional aspects, the contract, the current market trends, and, unless you obtain an all-cash buyer for your home, the fact that there will be an appraisal performed, which must be no lower than the agreed-upon contract price of the property (if further issues are to be avoided). And, possibly your Realtor may also have some experience with pricing listings using some of the same guidelines the licensed appraiser uses.

The buyer's lender's appraiser will have the ultimate word for value -- yes, theoretically it's possible to appeal but most often that is not successful, or it may require the buyer finding another appraiser, at buyer's cost. 

Many sellers are familiar with "comparables" - but what goes into that word?  It means they must be within the area, similar properties and recent active, pending and solds. Remember, an appraisal is an "opinion of value", so opinions may vary somewhat from one professional to another.  Usually, about 6 properties are selected. Closed sales must be within last 6 months, maybe more recent within last 90 days, within one mile, and within 20-25% of the property's living area square footage (GLA). If the buyer is obtaining a conventional loan, all square footage must be permitted to be included in the appraisal; an FHA loan requires "permittable" square footage.  Have you heard of bracketing? That's where properties both lower and higher in value, less and more in GLA, lot size, possibly age and other physical characteristics such as upgrades and remodels, are used as comparables. So, for example, a 900 sq. foot house is not compared to a 2500 sq. foot house. And the appraised value of your home cannot be higher than the highest priced sold comparable.  So comparable selection is important, and if it's difficult, i.e., due to lack of  recent sales or listings, to find them meeting all the selection criteria, the appraiser has to justify a different selection in written remarks.

Living areas don't include, for example, a guest house, patio room or the garage.  And, a long held belief is that in order to a bedroom to be qualified as such, it must have a closet -- but that's not true according to the International Residential Code. To qualify, a bedroom must be over 70 sq ft, have a minimum 7 ft of wall length, at least 2 methods of egress including doors and windows to the outside, and have at least 7 ft ceiling height in at least one-half of the room. It doesn't have to have a closet.

Sellers, the more information you can share about the property, the more your Realtor can assist the appraiser, because not all information is readily available on the MLS listing. Provide your agent with a list of improvements: what, when, cost, and any permits for additions which you physically possess or obtain online, the name and phone number of any HOA property manager, HOA information on dues and amenities.  Your agent will be able to provide area comparables and copies of any multiple offers, plus a copy of your contract with the buyer.

This post if about the general basics of appraisals, there can be other factors to consider, such as a fastward moving up or down market.

If you would like more information about pricing your property and get the opinion of a real estate professional who's been licensed since 1994, please contact me via phone, text, or email!

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

It's the Time of Year For Termites in Southern California

 Graphic of ant and termite

Termites often swarm at this time of year, which will expose properties to the damage they can cause.

It's not surprising in my experience to find that an owner may have owned a property for years, but has not done a termite inspection since it was purchased, let alone any repairs. Keeping up with pest control on an annual basis, or biannual basis, can save money.  Tenting or even local wood repair alone may cost thousands, what used to be a $2000 tenting/repair cost a few years ago is now $4000.  So try to avoid this major cost (whether you're selling or not) by taking care of moisture issues and soil contact issues:

1. Eliminate or reduce moisture in and around the home, which termites need to thrive.
   
2. Repair leaking faucets, water pipes, and exterior AC units.
   
3. Repair fascia, soffits, and rotted roof shingles.
   
4. Replace weather-stripping and loose mortar around the basement foundation and windows.
5. Divert water away from the house through properly functioning downspouts, gutters, and splash blocks.
6. Routinely inspect the foundation of a home for signs of mud tubes (used by termites to reach a food source), uneven or bubbling paint, and wood that sounds hollow when tapped.
7. Monitor all exterior areas of wood, including windows, doorframes, and skirting boards for any noticeable changes.
8. Maintain an 18-inch gap between the soil and any wood portions of your home.
9. Consider scheduling a professional inspection annually. Wood-boring insect damage is not covered by homeowners insurance policies. 
10. Store firewood at least 20 feet away from the house. *
    

There are different kinds of termites, and vary according to region.  In Southern California subterranean and drywood termites are often seen, but dampness draws in termites also.  Amazingly, termites may not just work on wood, I once saw a house in Long Beach with concrete slab foundation for an added family room that was literally crumbled underneath the carpeting from termite damage after it was pulled back, and walking over the carpeting caused a scrunchy sound.

And, if you're thinking of selling, termite damage repairs are considered negotiable in the standard CAR contracts, but most buyers will ask for the seller to cover the cost.  If termite repairs are stated in the purchase contract (and they aren't always), lenders will want to see termite clearance in order to make a loan, and if buyers are footing the bill, the lender has to know that amount and approve it before final loan funding. 

Termite damage is most often seen in houses, but condos are not automatically exempt -- especially if there is dampness and/or trees nearby and a way to termite to enter the interior. If your home is near a park or school where grass/landscaping is watered frequently, then those features may draw termites to your property.

If you are considering making a change of residence with your house, condo or residential units, please contact me for more information on selling.  Getting the right price is very important, but also knowing the terms smooths the way for a successful closing!

*Information courtesy of BPG Inspections

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

Homeowners May Be Losing Millions When Selling to "We Buy Houses" Investors

I'm sure you've seen the yellow signs with black handwritten lettering on the corners as you drive by, advertising all cash purchase, fast sale, easy sale, etc.  There are also some TV advertisers along the same lines.

Here is a story about research done in a Philadelphia market where such purchasers approach poor and vulnerable homeowners in areas where owners may not want to approach a real estate agent for various reasons.

A report from a Drexel University Nowalk Metro Finance Lab states sellers are often short-changed when selling the people behind the "We Buy Houses" signs, visible throughout the Philadelphia area. This report found that owners selling to such investors without listing on the multiple listing service (MLS) typically receive less than half the value they would receive if using the traditional method of selling. In that market, a seller received $126,000 less than a similar home on the MLS, an estimated $500 million loss in the Philadelphia market over 4-1/2 years.  This study also states only two cities and four states regulate the wholesale market, which unlike real estate agents, does not require a license to work in.

The investor may approach an owner with a price in mind that accounts for his/her after-resale value minus their capital costs and then quotes a price to the homeowner. If the purchaser is not a contractor himself/herself who will do the work, then that investor may be looking for a connection who is looking to enter that market and sells the contract to them for a profit to the investor.

In Philadelphia these transactions are concentrated in certain areas where the majority of homes never go on the MLS.  The Finance Lab looked into the reasons why these owners would not list with an agent and skip getting a higher price - it had to do with factors involving racial discrimination, economic discrimination, and lack of knowledge and assistance on how to fix up a home for sale in today's HGTV-style market. So a lot of home equity ends of being lost to the owner, and eventually the sale leads to gradual gentrification of neighborhoods by new owners.

Not addressed in this article are the more recent Fair Housing and Fair Appraisal requirements which are now required in Realtor contracts, but which appear to be completely washed over in the Philadelphia areas because investors are typically unlicensed free agents, not regulated except where described above.

There are also licensed groups operating in a similar way in the wider real estate market in many states, including California, with the same aim - to buy low and sell high.  Sellers of these properties often feel they are being saved the hassle of preparation to sell, especially if they are near foreclosure, a short sale, or are low of funds to paint, repair and fix up to sell. But so often it's the same story - they don't realize how much money they're leaving on the table -- and in fact, there are now some loan programs which will analyze the equity and front the money to owners for just that purpose, who can they repay the short term loan out of escrow proceeds -- and still walk away with profit.

If you are wondering about a cost-to-sell, or a value for selling without prior repairs, this is the time to find out, as non-investor buyers are looking for a chance to own.

Please contact me, an experienced Realtor with 28 years experience, for a no-obligation market estimate for your house, condo or multi-unit residential property.

 

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

Housing Inventory/Supply in Southern California - It's a Big Issue

Data as of 2-24-2023 - Market Summary

Housing inventory has been an issue for about 10 years, but one bright spot in the graph shows that, overall, inventory in Los Angeles County has increased to 3.1 months supply as of December, 2022. According to data released by California Association of Realtors, this is an increase of 138%+ compared to 2021 when the houses were being consumed by multiple offers in a matter of days.  It's also an overall increase compared to previous years when inventory was as low as one month in many cities/neighborhoods. But it's still 50% lower than what is considered the traditional time for inventory supply:  which is 6 months, meaning that at the present rate of sale, it would be 6 months before there were no houses left to sell if no new properties came on the market during that time.

The inventory increase shows similar levels for statewide and nationwide, but is still well below the 6 month standard. What is completely obvious is the $200,000+ income required to purchase in Los Angeles County and California as a whole compared to the lower national average of $94,400.

Graph of sellers in Jan and Feb

Steven Thomas, Southern California economist who publishes Reports on Housing, follows the market in his weekly videos on You Tube and Facecook.  In his lastest weekly report, new listings are down 41% in January, and February is down 40%, or a total of 17,000 missing for sale signs in Southern California, with San Diego being the most affected. Note the graph lines showing levels in years since 2015, and where we are now.  One of the major reasons, according to him, for the lack of inventory are the very low interest rates current property owners are enjoying--not giving enough incentive to move.

If you would like to find out about the selling process for your house, condo or 4-unit property, please contact me for vital information about selling, whether yours is an owner-occupied property or investor owned.

#marketvalue #LongBeachrealestate #housinginventory

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

What To Do With All Your Stuff, Whether You're Selling or Not

The Art and Necessity of Decluttering

 

Barcelona Chair - 1929

Did you ever hear of Mies Van Der Rohe?  Perhaps not, unless you have an interest in architecture.  (He also designed the “Barcelona Chair” around 1929 .) Mies Van Der Rohe died in 1969, a German architect who did many works in the U.S., and often aspired to the ideal of “less is more”, a saying about the ideal of creating something so beautiful it cannot be further reduced.

 

Opinions may differ, but there are many people who would say that the type of stuff in the next photo could be reduced – quite a bit.  “Decluttering” is the word most familiar to people.  

Whether you’re moving, or just wanting to move your stuff, decluttering can bring improvements to your daily life, and most probably to your outlook in general.

All you have to do is watch the TV series about hoarders to view the extreme situations.  Most people are not this extreme, but neither were the people in the TV show at one time.  But whether you’re at the low end or the high middle of the distribution curve on junk,  the process can take a lot of work, because that stuff may have meaning to you, or you think it does.

Garage tools piled on top of each other

If you do put your home on the market, having too much stuff in your house or condo can detract from the buyer’s ability to see and focus on the property, and in the end could hurt you financially.

There are people, such as Marie Kondo, who specialize in decluttering, but really most people can tackle this themselves if they keep in mind:

1. There’s a financial advantage in keeping only what you use.

      2.   That breaking down the clean out process into smaller tasks can lighten the load.

3.            3. That selling, donating or sharing are three primary ways to lighten your inventory—sell to consignment shops, Facebook groups, estate sale specialists, or donate to a halfway house, charity groups, neighborhood yard sales.  1-800-GOTJUNK is a resource for taking away stuff that cannot be donated, or, pick a self-storage site for later attention.

Decluttering may also mean a transformational growth process, which can lead to establishing more effective daily routines, simplifying meals and grocery shopping, and quieting the noise in your life.  More resources on simplification are found here.

If cleaning out is a task you would like to leave to a professional, the national hourly rate for a member of the National Association of Professional Organizers , for example, would be between $50 to $100 an hour. It might be worth a consultation to help you get started and actually speed up the process.

The key is, don’t try to downsize in a month. You may give up something you wish you’d kept (but thinking you need everything doesn’t work either).  It’s essential to start developing the habit of reviewing your possessions and think of when the last time was you wore an item of clothing, or used a tool or appliance, or are you keeping items you inherited that may only be taking up space.

Your home should be seen as beautiful in the eye of the beholder. Get started on your plan, your goal is reachable!

Mies Van Der Rohe

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

Long Beach Sales and Listings Trends; County Sales and Listings Trends

Closed Sales Graph for PWR Region

In the region covered by the Pacific West Association of Realtors, extending over south Los Angeles County and Orange County cities, the graph clearly illustrates falling volume of sales. Single family homes closed in January 2022 were at 1,650, while SFRs closed in January 2023 were at 1,091.  Townhouse-condo closings were similar: 849 last year vs. 471 sales in January 2023 -- a drop of almost 50%

But the new listings on market show an improvement over the same geographic area:

Homes for Sale Graph in PWR Region

January 2023 shows an active inventory increase of 12.5% for single family homes, and an increase of 30.6% increase for condominiums-townhouses compared to one year ago.  Neither are as high as 2021, but the upswing shows more owners are moving on to allow more buyers to enter the market.

The Mills Act Program open in Long Beach for First Time Since 2020.

Historic Craftsman home

The Mills Act Property Tax Abatement Program is designed to help owners who have purchased a historic property, or have high tax burden due to transfer or property reassessment.  According to the State's Office of Historic Preservation:

"The Mills Act is the single most important economic incentive program in California for the restoration and preservation of qualified historic buildings by private property owners. The Mills Act Program is administered and implemented by local governments. Mills Act contracts are between the property owner and the local government granting the tax abatement. The Office of Historic Preservation is not a signatory to Mills Act contracts.
 
"Each local government establishes their own criteria and determines how many contracts they will allow in their jurisdiction. For answers to specific questions such as local eligibility criteria, application procedures, and contract terms, contact the city or county official for your jurisdiction."

The City of Long Beach's program for the Mills Act is hosting mandatory workshops in the near future for those interested in applying for this program, on January 28 and February 18: "Although tax savings cannot be guaranteed through entering into a Mills Act contract, estimates can be made through the application process to determine likely potential property tax savings.  The Mills Act is especially beneficial for recent buyers of historic sites, or owners who may have recently had a property transfer or tax reassessment. The program is generally less beneficial for property owners who have owned their property for more than 10 years."

The application package deadline is March 3. Please go to the City's website for more information on this process.  For properties and owners who qualify, there may be significant tax savings. "The incentive is achieved through property tax relief to owners of historic properties in exchange for the rehabilitation and restoration of the historic property pursuant to the terms of a Mills Act contract with the City." The purpose of the Mills Act is to rehabilitate and restore the historic properties, which means it is located in one of the historic districts or is a designated historic building. 

 

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