Rebound for SoCal Housing Market
Dated: July 27 2020
Thank you to Dan Dobbs, a great lender partner that has pulled from several news sources to compile this information and update on the SoCal Housing Market. Enjoy the read!
The SoCal housing market is showing
signs of heating up after a coronavirus-induced slump.
Sales are still below year-earlier levels but are up sharply from spring, when stay-at-home orders all but froze the market.
Some agents are seeing bidding wars. That level of activity may not last.
COVID-19 cases have surged throughout California as the economy reopened, causing the state to reimpose some restrictions.
But for now, would-be buyers who still have the financial wherewithal seem eager to get their hands on mortgages with rock-bottom rates.
The latest evidence came this week when data firm DQNews released numbers for June.
Sales across the six-county SoCal region jumped 43.5% from May, the largest increase ever from May to June in a data set that dates from 1988.
Sales were still at a record low for a June & down 15.2% from a year earlier, but deals had declined 45% year over year in May and fell 31.5% in April.
The region’s median sale price, meanwhile, rose 2.9% from a year earlier to $555,500 in June, a record high.
The median is a point which 50% the homes sold for more & 50% forr less.
Last week, the average rate on 30-year fixed-rate mortgages dipped below 3% for the first time on record and this week stood at 3.01%, down from 3.75% a year ago, according to Freddie Mac.
Many sellers pulled their homes off the market this spring after stay-at-home orders took effect and fears over the coronavirus surged.
Listings have risen since April, but the number of homes for sale last month in Los Angeles and Orange counties was 26% below year-earlier levels, according to Zillow.
Forbearance programs, which allow borrowers to delay mortgage payments, might also be playing a role in keeping prices high and inventory low.
Experts say home sales usually decline before prices do in a market downturn as sellers are reluctant to drop their price until they have to.
Under the federal CARES Act, borrowers with a federally backed mortgage can delay payments for up to a year if they have a financial setback stemming from the coronavirus.
That means many struggling homeowners aren’t entering foreclosure or being forced to sell rapidly to stave off that credit-ruining prospect.
Forbearance, however, eventually ends, and borrowers may lose their homes if they can’t afford to make up the missed payments.
The resurgent virus also threatens to throw more people out of work, and expanded unemployment benefits under the CARES Act will expire soon.
Here’s how the June sales data broke down by county:
In Los Angeles County, sales rose 40.8% from May and fell 24.3% from a year earlier. The median price rose 4% from a year earlier to $643,000.
In OC, sales rose 49% from May and fell 22.1% from a year earlier. The median price rose 4.1% from a year earlier to $765,000.
In Riverside County, sales rose 38.9% from May and fell 12% from a year earlier. The median price rose 7.8% from a year earlier to $430,000.
In San Bernardino County, sales rose 36.6% from May and fell 3% from a year earlier. The median price rose 7.4% from a year earlier to $365,000.
In San Diego County, sales rose 52.9% from May and fell 2.4% from a year earlier.The median price rose 1.7% from a year earlier to $600,250.
In Ventura County, sales rose 49.7% from May and fell 23.9% from a year earlier. The median price rose 3.5% from a year earlier to $600,000.
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