Is the market actually shifting again in a different direction? Today I have a huge update for you guys.

Hey, Scott Himelstein with the Scott Himelstein Group. All right, welcome back to our vlog. So today, I have a huge market update for you. If you’re not really following the real estate market, you might actually be a little bit surprised. Despite what you actually hear on the media that the market seems to be crashing, it’s actually the complete opposite of what’s taking place in our marketplace here in Southern California, and for the most part, nationwide.

So look, I think if you go back to last year, the beginning of last year in 2022, remember, interest rates were at 3.25%. They went up to as high as 7.5% in the fall of 2022. Now, the rates have come back down a little bit. They’re now hovering just inside 6% as we shoot this video on January 31st, 2023. As a result of those interest rates coming down and the lack of homes for sale, we’ve seen inventory drop in LA County more than 50% since the Fall.

Take ZIP Code 91326 of Porter Ranch, so we’ve been monitoring that ZIP Code. What we’ve been seeing in that ZIP Code, in late Fall, you had 84 properties for sale. And since then, currently right now as of today, you only have 40. So that is a difference of 48% difference right now, drop in your inventory. And we’re seeing that play out in almost every neighborhood across LA County.

So what can we attribute that to? Well, I think right now you’re finally really being able to see the end result of everybody getting these really low interest rates, especially the sub-3 interest rates or people that have refinanced into an incredible interest rate, it just doesn’t make sense for them to sell.

So the people that are selling, either they’re going out of state, they have a life event: maybe it’s a divorce, maybe it’s a job relocation that they have to move, maybe they want to be closer to grandkids, or maybe the parents passed away and the kids are now entrusted to actually sell the property. So again, to recap, unless you have a major life event, most people aren’t selling if they have a sub-4 interest rate. Now, this great refinance movement that you’ve seen over the last couple of years is finally playing out, because it just doesn’t make sense for a lot of people to sell.

So how does this affect both buyers and sellers? Well, if you’re a buyer and you are waiting for the market to crash and the prices to go down even another 15, 20, 25, 30%, it’s probably not going to happen.  You probably missed out on your window, because right now there’s still a lot of demand. What we’re seeing is multiple offers on a lot of properties.

So for example, we’re seeing properties that in November and December, maybe they were on the market 60 to 90 days. Now they have multiple offers on them because there’s just simply not enough inventory to meet the demand right now. So I’ll give you a couple of examples. We recently showed a house, almost $800,000 in Valencia, and the house had been on the market for 74 days. We went to go take a look at it. It had five offers. Four of  them were above the list price. This is a home that sat on the market for over two months had multiple offers all of a sudden. Now, it’s not just in that price range only. We’ve been showing one of our clients that’s looking in Woodland Hills, and they’re looking in the $1.3-1.5 range, and everything has multiple offers.

So we’re back to where if you like a property, you really have to make an offer right away. We’re already seeing on our listings and the offers that we’re writing that the buyers have to write shorter contingency time periods again, whether it be escrow, inspection, all those things that really over the course of the last six, seven months, the buyers were able to get as concessions from the seller. So that’s really the big difference.

So if you’re a buyer that was looking to buy in the spring, you may want to make sure you get all your ducks in a row to make sure that you are actually ready to buy now as the market is changing.

All right, so if you’re a seller, what does this mean for you?

Well look, over the course of the last 7, 8, 9 months as the market has really shifted, it’s really become in the buyer’s favor. Well, literally, in just the last two, three weeks, that is starting to change again with multiple offers, sellers giving less concessions. So obviously you have to be priced right. That’s really critical. You’re not going to be getting the same pricing as you would in April and May of 2022. But you know what? It’s right now very common to see homes sell in one week just due to the high demand out there. So you can still get very high top dollar, and the prices are starting to increase incrementally as the demand is so high right now from buyers, and you just don’t have the supply to meet it.

So if you’re looking to buy or sell, give us a call today so we can talk to you about how we can help you and draft a plan that’s custom to your needs. And again, if you have any real estate questions, give me a call: 818-396-3311. That’s 818-396-3311. I’m Scott Himelstein with the Scott Himelstein Group and thank you for watching this video!