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The Southern California housing market is poised for growth in 2015. With the economy expected to grow more robustly and housing inventory continuing to improve, housing sales and prices will see a modest upward trend in 2015. See how the top trends will impact your business this year.
SoCal home sales and median sales price expected to keep rising
At the end of 2014, new and resale home sales increased by 4%, and the median sales price increased 5% to $415,000 year-over-year. The majority of homes that were sold were in Riverside County, and Orange County boasted the highest median home price ($591K). Home price gains are expected to slow down, allowing first-time, younger buyers who have been saving for a down payment to be in a better financial position to make a home purchase.
Mortgage rates defied forecast in 2014; expected to increase in 2015
30-year mortgage rates were widely predicted to rise to 5% by the end of 2014, but instead decreased slightly. The typical monthly mortgage payment for Southern California home buyers in January was $1,501, down from $1,528 in January 2014. Professionals are predicting that mortgage rates will eventually increase this year, and are urging would-be home buyers to act soon because of the measurable tax benefits.
Millennials will lead first-time home buyer revival
First-time home buyers and millennials will return to the housing market in a big way as economic conditions improve. By the end of 2015, millennials will become the largest home-buying age group. In the L.A. market, 1.2 million adults plan to buy a new home in the next year, and nearly 40% of these adults are Millennials, representing the new influx of homebuyers that agents will need to attract.
Sources: DQNews.com, CoreLogic DataQuick; Southern California Home Sales and Median Sale Price Rise, 1/14/15; CALIFORNIA ASSOCIATION OF REALTORS®’ (C.A.R.) “2015 California Housing Market Forecast.”, Feb 2015; Millennials Will Lead First-Time Home Buyer Revival“, Investors Business Daily, 12/4/14; “Mortgage rates defied forecasts in 2014; what's ahead in 2015?”, LA Times, 1/1/15; Scarborough LA Times Custom Recontact Study 2014 R2
Categories: Real Estate