Los Angeles Housing Market

Housing Forecast for Los Angeles 2018 to 2020

The real estate/housing market in Los Angeles enjoyed good growth during 2017. And predictions are for higher prices and good conditions for sellers.

However, the stats for January 2018 were a little sobering. According to curbed LA,  only 4,847 homes were sold in LA County. That’s an alarming drop from 6,613 in December and much less at 5,188 sales in January of 2017.

Prices grew $41k this spring of 2018. Predictions are for continuing high prices due to ongoing shortages.

The wild fires had an effect, in LA County and hitting regions such as Sonoma and Napa valley regions hardest. The insurance driven recovery should revive the housing market in LA.

The losses were estimated at nearly $10 billion with a $500 billion hit to the economy. The numbers are similar to the floods experienced in Houston TX or Miami FL .  Some homeowners are discovering they weren’t covered sufficiently with their home insurance.



The California Association of Realtors Outlook

CAR reported that:

  • single-family home sales fell 7.6% in January down to 388,800 and down 2.9% from January 2017.
  • January’s statewide median home price was $527,800, down 4.0% yet still 7.3% higher than January 2017.
  • entry level homes in California rose to $220,000 in California, up more than 10 percent from 2017 when entry-level home averaged $200,000.
  • the DOM for a single-family home remained low at 27 days in January, compared with 36 days in January 2017.

The California Department of Insurance said the fires cost $9.0 billion in insurance claims so far, which was 3 times the $3 billion claimed previously.  For the next few months however, California housing will be in extra short supply.



Fires might actually be an unfortunate distraction from the housing crisis that’s existed for many years now in Los Angeles and across the whole state of California. The state just can’t seem to get a handle on the need for more homes.

The OC Register reports that CEQA lawsuits against developments are a serious issue for housing, especially in the LA area. As Los Angeles residents suffer financially, and while housing crash rumors float around, prices are rising.  You’ll need an income of $120,000 to buy a home in LA in 2018.

Prices of condos in downtown LA are reportedly $90,000 higher than last year.

Insurance Companies Fielding Claims from Homeowners

Is it instinct or just common sense that California will continue as the most desired place to live on the planet? Does the climate in San Diego, Sacramento , Bay Area, and Los Angeles along with the high paying jobs, interesting geography, lifestyle and recreation, California is a magnet for people around the world.




Infographic Courtesy of CAR.org – LA Buyer Profile

In 2017, real estate sales in 2017 in California eased however house prices remain high in Los Angeles, Orange County, San Diego, and San Francisco / Bay Area housing markets which had previously approached prerecession highs. But will they rise further and is this the right time to invest in an income property?

The short answer is Yes. Houses for sale in Los Angeles County and Orange County are in short supply and new residential development is not keeping pace. It would take a market crash to stop the price rise and even then it would only be for a few years. For wealthy investors, a few years is well worth the wait. The question is where to get a realistic price? The hunt continues.



Santa Monica House Prices

Average House for Sale Still Sells

CAR reports the average house price in LA rose about 10% in late summer of 2017. San Bernardino, Riverside, and Orange County had strong price growth of 8% to 10%.   Contrast that with the drop in the Bay Area of more of about 3% or $14k to $33k for detached homes and you realize LA is a more attractive housing market for property investors.

The effect of the fires will be to reduce availability and raise prices. So not much relief in site for the LA market. As in most housing markets across the US, millennials have been shut out of the markets. They’re in their child bearing years and have saved up small fortunes to ready them to finally purchase. They’ll be buying in LA or Orange County somewhere.

Sales volume actually increased 11.5% in the last month, so homeowners appear to be loosening up finally.  Realtors are wondering how they can get people to sell their homes. Inventory is the big story for the fall of 2017.

This graphic from CAR.org’s latest report shows inventory in California is sharply down from last year. Sales above $500k were up up. Active listings in the lower price ranges are down considerably ( -10% to -28%).

Screen capture courtesy of CAR.org

And buyers
real estate investors are hopeful they can find the right property in the right city or zip code. Zillow has forecast house prices in Los Angeles to rise throughout 2018 while CAR shows it moderating. A lot depends on the political climate and interest rates.

Screen Capture courtesy of Trulia

We should keep in mind that only 30% of Californians own a home so the door is wide open for opportunity and new sales, particularly with first time buyers.  The problem is that homeowners don’t want to sell and buyers can’t afford the prices.

Why are Buyers Buying in California?

CAR’s 2016 survey showed only a small portion of buyers buy property as an investment. Only 13% are real estate investors.

California Home Buyer Survey Buyer Survey – Screen Capture courtesy of CAR.org

The US economy will pick up steam and Californians will be buying a home again even if they have 1 hour+ commutes, higher interest rates, and out migration to remote towns.

Check out the top housing factors below affecting housing prices in discover a better homes for sale search process.




The Telling Stats about LA’s Forecast

If buyer’s are hoping for bargains in the next 4 years, they’re unlikely to find them. Despite a dip in September, prices for homes and condos are up $24k to $30k from one year ago. Are the Asian and Persian buyers pulling out of LA?  The Trump instability and trade issue might be a pause before even more money pours into the reviving American economy.  Make American Great Again, also creates excellent investment opportunities in California, paying out in $US.

  • jobs being repatriated back to the US from Mexico and China
  • employment already good and rising
  • the end of Obamacare?
  • the end of Dodd-Frank restrictions on lending
  • general Federal easing of real estate development expected
  • it will take some time for mortgage rates to rise
  • still isn’t enough housing to house LA’s growing population (recession)




It’s the Los Angeles housing forecast that is perhaps one of the most interesting forecasts for the US for the next few years. California’s housing developers are hard pressed to build homes to house the population. We can speculate that homes will rise in price for the next 4 years. It’s not easy to predict though when people are talking real estate bubbles, NAFTA cancellations, Brexit, skyrocketing prices, vacillating oil prices, reduced immigration, and presidential elections.  




malibusmall
Malibu Coastal. Photo courtesy of marisolmalibu.com

Overall, the Los Angeles forecast was very good for sellers with plenty of demand and with the average price of a home hitting $690,000 last summer. Affordability is dropping though and only 30% of LA county residents own a home. 

Given the nasty commutes Los Angeles workers are enduring, this housing crisis should be a top priority for the California state governor.

A few pundits are suggesting homeowners need to build granny flats in everyone’s back yard.  Political battles are forming over the effect of regulations on LA’s and California’s home construction. Who will win? Will they battle Trump head to head to stop new development?

The situation may become worse than what San Francisco, Vancouver, and Toronto have been through, and what Miami, New York, and Boston may be into now.


Save your Money on Auto Insurance Quotes in LA

Are you paying too much for car insurance in Los Angeles? Some zip codes and neighborhoods are subject to higher premiums. Are you okay with that? How about finding lower car insurance rates and making it a habit of shopping for auto insurance every year? 2017 is a good year to save:)

Here’s the Hottest Zip Codes in Los Angeles

LA Curbed’s list of hot zip codes: Los Angeles’s 90012 zip code is shaping up to be the 2nd fastest growing area in the nation at 8.8% growth, 2nd behind only Gilbert AZ. The 90012 zip code includes Chinatown, the Civic Center, Elysian Park, Victor Heights, parts of the Arts District and Bunker Hill, and most of Little Tokyo.

Here’s the LA Times hot zip code list:

Santa Monica 90402 – Average home price: $3,237,500

Hermosa Beach 9025 – Average home price: $1,693,500

Lincoln Heights/Montecito 90031 – Average home price $458,500 +14.6%

City Terrace  90063 – Average home price: $320,000 +18.5%

Marina Del Rey 90292 – Average home price: $2,157,500 +23%

Manhattan Beach 90266 – Average home price: $2,100,000 +10%

Compton – 90220 – Average home price: $285,000 +9.8%

Playa Del Rey 90293 – Average home price: $1,517,500 +26.5%

Toluca Lake Studio City  91602 – Average home price: $1,022,500

Read more on the best zip codes in the US for investors and homebuyers.

LA Home Prices Fully Recovered?

The Los Angeles home price graph below courtesy of Zillow shows how prices have almost returned to pre-recession values and are beginning to level off. To forecast prices and demand for the LA region, we’d have to examine the cause of the moderation and if it’s a fact. Here’s LA’s hottest zip codes.

 

Last year, home prices in LA rose 7.8%. That’s a fairly strong ascent to just snap out of, so we’re left wondering what really is the outlook is for the 2017 to 2020 period? With prices high and rising, it makes sense that the number of buyers will dwindle (preferring to rent) and a leveling off would occur. It seems however, this is more of a guess by forecasters not really backed up by a solid consideration of all the factors that will be in play during the next 4 years – defeated regulations, growing economy, and reduced immigration.

Homes for Sale in Los Angeles: Prices, Trends from Zillow

Try the Zillow Home Search Widget to learn more about LA Homes for Sale. Realtors, click here to hear more about the Zillow leads program:

 

Home Sales Volume Chart: Los Angeles

la-home-sales-firsttues

Is there a Housing Bubble Market?

harvardHere’s the thing. According to a Harvard real estate guru, bubbles don’t burst until demand dries up — an increase in unsold inventory.

Do you honestly think there will be no demand for coastal California property, especially Los Angeles county or Orange county?  As you’ll see from the data in this post below, there is huge demand for property. Supply is the problem.

Factors Affecting House prices and Availability in LA

  1. Housing Demand – High overall demand – “all cash bidding wars” in some cases
  2. Housing Supply – Throttled, supply is far from what’s needed
  3. Mortgage Rates – Continuing Low, especially in light of global economic slackening
  4. Down Payment and mortgage rules – Banks are withdrawing FHA loans however some are offering downpayments as low as 3%
  5. Regional Employment – Very low and remaining low
  6. Buyer Income – low and not rising much
  7. Home Prices – High and rising – out of reach for many buyers – many consider LA homes grossly over-priced
  8. Demographics – Millennials coming into family and home buying years and LA millennials have had the lowest rate of home buying (pent up demand)
  9. Number of Renters – increasing fast
  10. New Home Construction: slow (100k to 140k per year)
  11. Economic-Foreign Trade – Trump expected to reduce US deficit
  12. Election Year – Voters uncertain of what Trump will create
  13. Taxes on Sale of Home – Tax situation is great for sellers




Historical Data

This intriguing graphic courtesy of https://journal.firsttuesday.us/ reveals that home sales in Los Angeles is actually well down from historical levels. The likely reason for that is lower income buyers simply have even less income to buy and of course the high prices. Home ownership is lowest in California.

la-case-schiller-index

A complete recovery of around 110,000 annual home sales will likely occur in 2019-2020, as end user demand in Los Angeles County is buttressed by a Great Confluence of Baby Boomers (Boomers) and first-time buyers who are lured by further employment (needed to accommodate population growth of roughly 1% annually since the beginning of the Great Recession).

That’s a forecast growth of about 20,000 homes per year over current current 2016 levels.

Another interesting stat provided by firsttuesday is the very low rate of home ownership and how much it’s plummeted. It’s on the uprise now, and you’re left wondering whether Trump’s renewed emphasis of America First will encourage the growth of home ownership?

la-homeownership

LA Economic Forecast – Very Rosy

la-economic-forecastThe forecast for economic growth for the Los Angeles is optimistic at this point. Visit https://laedc.org/2015/09/30/new-2016-2020-economic-forecast-published-93015/ for the most recent info and their forecast up to 2020.

 

This Stat from CAR shows homes have been on a rollercoaster ride of sorts yet, 2016’s expected resale volume is still well down from 2011 and 2012’s highs. If incomes should rise in the LA area, it could have the effect of stimulating new housing construction and increase sales of homes. With the number renters skyrocketing, there’s a huge pool of potential buyers.

Home reSales Forecasts 2016f

la-housing-stats

This graphic reveals the exceptionally high cost of renting in Los Angeles compared with other major centers. The housing availability problem isn’t isolated to California or LA, it’s a US wide issue. The high housing costs in the coastal California areas however may prevent many skilled workers from migrating to LA to work. Startups for instance may be forced to leave San Francisco, Bay Area and LA because of the cost. San Diego County may be a better option for the short term.

la-rentals

This is a short term forecast from LA realtor James Campbell, who believes prices will drop?!

What can we conclude from the above data? That LA’s market for realtors is very promising, yet just as it is in San Francisco, Toronto and Vancouver, finding sellers and convincing them to sell will be a key challenge.  Digital marketing efforts could be vital to any realtor hoping to maximize demand and achieve highest price for their clients. Is this the right year to buy rental income property?  Find out which are the best investments in 2017 including investing in real estate.

Check out other posts providing realtor tips, prospecting strategies, social media strategy, and tactics used by top flight luxury realtors and even lead generation companies.




Related posts: Housing Market 2018 | Florida Real EstateBlockchain Real EstateSan Francisco Housing ForecastLos Angeles Housing Market | Sacramento Housing Market | San Diego Housing Market | Real Estate Agents | Blockchain Real Estate | Toronto Real Estate SEO | Vancouver Condos | Toronto Condos | Vancouver Housing Forecast | Affordable LeadsRealtor Branding | Realtor Branding |  Realtor Growth Hacks | Realtor Skills | Realtors Benefits | Home SearchHousing Crash  | Stock Forecast | Foreign Exchange Rate Forecast | USD CAD Exchange Rate Predictions |  Oil Prices | Mortgage Refinance Rates 

Gord Collins —  I generate leads for realtors in Los Angeles, Phoenix, Denver, Seattle, Chicago, Boston, New York, Dallas, Houston, San Antonio, Austin, St Louis, Minneapolis, Green Bay, Charlotte, Tampa, Miami, Orlando, Toronto, Sausalito, Santa Clara, Mountainview, Fresno, NAPA, Tiburon, Oakland, Palo Alto, Anaheim, Beverly Hills,, San Diego, San Francisco, San Jose, Sacramento, Encinitas, Orange County, LA County, Riverside, Malibu, Santa Barbara, San Bernardino, Portland, Washington, Atlanta, Irvine, Nashville, Sunnyvale, Salt Lake City, Riverside, Rancho Cucamonga, Costa Mesa, Thousand Oaks, Simi Valley, Glendale, Oceanside, Long Beach, Huntington Beach, Carlsbad, Santa Clarita,  Henderson, Mesa, Temecula, Kirkland, Redmond, Kansas City, St Louis, Stockton, Scottsdale, Palm Springs, Chula Vista, Escondido, and Santa Monica, Venice Beach, and La Jolla. See additional housing market reports on New York NYC, San Diego CA, and San Francisco CA.

Where to Invest in Real Estate – New Business Opportunity 2017

Brilliant Investment Opportunities

It’s easy to be genius. You only need an open mind to see what’s right in front of you, and dig deeper to uncover what fortune might be underneath. Okay, maybe you have to do a little work!

One marketing or investment weapon won’t be good enough, you’ll need multiple vehicles:

I was watching a group of kids play tennis at a local park where I play. There were 50 lb, 7 year olds blasting the balls across the court. I thought it was amazing that someone with very little physical strength could hit the ball so hard and so accurately. The instructor had taken their open mind, taught them how to swing and hit properly.




It seemed that if you did it properly, you could hit the ball at unbelievable speeds whether a serve, forehand or backhand –  minimal stress and effort.  And they had an aresenal of weapons.  I played a 13 year girl and she didn’t weigh much more than 90 lbs. I thought my strength and 100+ mph shots would be too much for her. I was wrong. She was good at everything, and put her whole body into all her shots. She wouldn’t even let me touch the ball. Very smart. 100 mph down the lines, every shot and all I could do is watch the balls zip by. 6-0 and it was over.

I learned that I didn’t really know how to play the game and didn’t have the overall skill to take command. These kids learned and executed properly. They possessed a power-packed selection of tools and assets, which together would overpower any opponent’s big strength. It gave them complete freedom to win. How did they learn? An open mind.

He’s got more than determination! Pic Courtesy of Tallahassee Tennis

The kids instructor took their open mind away from single skill mastery to a mindset of combined skills and overall mastery – to become a professional. This gave them many options which made their individual shots and competitive tactics even more effective.

It’s a big picture, top-down approach that I like a lot, so why not apply it our business goals?




Here We Are in 2017 – is Anything Going to Change for You?

You’re wondering how you can join in on the best investments of 2017 and beyond.  The best investment is a winning website that generates leads and sales continuously, and spins off new exciting business opportunities. Those opportunities act as a self-supporting network of sales generators.

If you’re a Realtor®, think well beyond visits and leads and see yourself as an entrepreneur and investor.  Because the blockchain AI future will scare you but delight you – it’s filled with sales people who can fulfill homebuyers and sellers many different ways — not just find a house to buy.

Hundreds of thousands of realtors right now struggle to make ends meet.  A lead for them is like winning a lottery. So many of them call me about getting cheap leads for them. Yet, none of them have any money to invest in themselves or launch a sustained digital marketing strategy to build their professional presence. They struggle each day, trying to sap leads from boldleads, commissionsinc, or agentlocator. That’s a tough life.




An Exciting Opportunity to Reach Deeper into Customers Lives

A golden opportunity then, is to capture leads for these starving realtors. It doesn’t matter whether there’s a housing crash either. They will always need leads, and someone is buying and selling.  When you have buyer and seller leads, all sorts of other revenue and business opportunities open up. Mortgages, home renovation, financial advice, new technology upgrades, furniture, and more. And when you’ve captured their email address, you can start selling them anything. Total open door. The opportunity goes well beyond serving Realtors with leads, to a building a direct connection with a vast financially enabled audience, where you don’t need the Google/Facebook monopoly to reach them.

The key will be to leverage each tactic or channel to reach more prospects and power up the revenue stream  — a top down strategy that leads to better branding and top of mind awareness leading ultimately to market domination.

A Brief Listing of Multiple Business Benefits

  • strong, sustainable presence online to reach buyers and sellers
  • strong rankings on Google search
  • strong reach to home buyers and sellers via social media (Facebook, Twitter, Linkedin)
  • offering additional services such as personal loans, auto loans, mortgages, furniture, home renovation, solar roof systems, etc.
  • less reliance on paid advertising or expensive promotion
  • building a powerful brand presence with a better value proposition
  • enhanced top of mind awareness with tens of thousands of prospects
  • accelerating database of contacts
  • social listening and predictive analytics to listen to your database of people and know when they might be in the market for just about anything

Instead of being trapped in a hierarchical mindset of how “how do I squeeze more from one single, narrow high risk channel“, you’ll be asking “how do I open up an array of channels that I can leverage as one powerful revenue generating machine?” We can draw an analogy to an individual baby boomer investor who searches for multiple streams of income. If one opportunity fails or dissolves, no problem, you’ll have many others to keep rolling on!

Here’s a hint: you need a Realtor, funds, digital content creators, a creative digital marketing pro and an online technology platform. Each by themselves has no power. Not until they come together does the full potential become very apparent. The network of other professionals will appear once you’ve built our core business.  They’ll become more vital as time passes, because we need to present their unique value to customers.

Leveraging Realtor’s Sales Crisis

There’s an intense and growing problem in real estate and the economy — there’s no homes for sale. Homeown ers (babyboomers) don’t want to sell. And government regulations have prevented new home construction. The result? Wicked price rises for condos, houses, and apartments all over North America and worse in New York, Los Angeles, Vancouver, Toronto, and San Francisco are a big frustration for everyone. A whole generation is at risk of never having equity in property and paying ever rising rental rates while commuting themselves to death — not quite the American Dream!




The real estate market currently is more of a luxury market with elite millionaire realtors dominating. Don’t be angry with them, it basically fell in their lap because they were positioned so well. Thousands of realtors scrambled to get under their umbrella, like some massive multi level marketing scheme.  You need to have that same positioning. Because prices will fall and people will start buying again and the economy will roar. This time though, these same “disenfranchised” realtors and investors won’t be part of the rise. That’s because with digital technology, smaller groups of well funded, expert marketing teams will dominate the market.  There won’t even be crumbs for the bottom dwellers.

This pic shows where Realtors go to get their buyer leads (these companies keep their seller leads).

Prices are Heating Up All Over

All the other realtors will look to lead generation firms for leads. They don’t have the marketing reach or impact to connect with buyers, much less sellers. As I mentioned in my post on lead generation companies, their high volume approach relies on Google and Facebook advertising. That leaves them vulnerable. Remember that ad blocking technology is becoming a real pain for these companies. With fewer ads displayed to reach buyers and sellers, ad pay per click prices are rising. Google has even reduced its ads displayed to 6 or 8 per page.

The battle to reach consumers, buyers and sellers is heating up. Who will survive? Publishers and companies with very deep pockets.

Are you interested in being a “Top Dog?” Contact me about this investment opportunity, unless you have something better? I’m interested in the Los Angeles real estate market. It offers the biggest potential, maximum flexibility, and lowest market entry cost.



Best Investments 2017 | Where to Invest | Housing Market 2017 | Housing Crash? |  Income Property is Hot
Hot Zip Codes | Los Angeles Real Estate Forecast | San Franciso Real Estate Forecast | New York Real Estate | San Diego Real Estate | Toronto Real Estate ForecastBest Car Insurance QuoteHomes for Sale Search Tips | Sell Your Home in 2017 | Car Insurance Toronto | Auto Insurance Chicago | Insurance Quote New York | Best Insurance Phoenix | Best Insurance Quote San Francisco | Truck Insurance Salt Lake City | Auto Insurance Boston MA | Car Truck Insurance Comparison | Real Estate Agent Toronto | Car Truck Insurance San Diego | Car Insurance in Miami | Blockchain Real Estate