Market Insight - Hot or Not?
- LA Creative Realty
- Nov 19, 2020
- 3 min read
If you're reading this blog, let me say congratulations: You've made it this far in a year that has presented unimaginable challenges for everyone and kept your sanity - no small achievement!. As we grapple as a nation with the ongoing election uncertainty there is some good news: the staggering 15% unemployment created by the pandemic has subsided to around 6.9% and retail sales have begun to pick up as many industries have been able to reopen (at least partially). This is a very positive development, but the big question is - without fiscal stimulus will it be able to last? Mortgage rates hit fresh record lows as of late and the Federal Reserve announced it would be keeping rates at near zero for the foreseeable future in addition to buying around $120 billion / month of Treasuries and MBS to put money into circulation. Thats a lot of stimulus! However, monetary policy can only go so far and the Fed has emphasized that Fiscal stimulus is going to be necessary to continue rebuilding the economy. One big winner from the Pandemic? Housing prices. As mortgage rates and housing inventory continue to hit record lows housing prices around Los Angeles have increased a whopping 14% from last year. Single family homes especially have been very hot, with many receiving double digit offers and some trading 15%+ over their listing prices. This has been especially true in suburban areas as many affluent renters in the urban areas have opted to purchase in the "burbs". Consumers are receiving emails from lenders with headlines like "beat out the competition with more cash"...Indicative of an extremely hot market where price is becoming secondary to "getting the deal". Record low interest rates and inventory levels have been a huge factor in this price appreciation, but is this kind of year over year growth sustainable? Only time will tell. In contrast, rents in Los Angeles have taken a big hit during the pandemic and have yet to recover. In some cases they are drifting lower still especially in urban areas. As more and more people are buying their homes in Los Angeles or moving out of state, rental unit inventory has been increasing significantly, and with it rents especially for apartments and condominiums have been trending lower and rental concessions are on the rise. Could this trend continue? Could the decrease in rents eventually lead to a significant decrease in multifamily NOI and therefore prices? Inventories of multifamily buildings have also been on the increase as of late. There has been a lot of change this year and many challenges both socially and economically, and big changes such as these can often act as "catalysts" for BIG investment opportunities. We'll keep our eyes peeled. 👀 Take care, - Gabe
In Escrow!
6737 Vesper Ave, Van Nuys
2 BR | 1 BA | 1041 SQ FT | 7,434 SQ FT Lot | $674,900
Calling all content creators! One of a kind opportunity to own a home with a separate turnkey creative space! Through your white picket fence you will find an inviting front yard and beautifully restored exterior. Inside you are greeted by a charming living room and dining room. Large windows allow plenty of natural light and the hand restored working fireplace adds charm. Sparkling hardwood floors guide you to two good sized bedrooms with brand new ceiling fans and attractive lighting. The bathroom features carefully restored tile and new fixtures. Kitchen includes a lovely breakfast nook, hand restored cabinets and stylish tile work. Property has brand new electrical. Huge backyard with firepit and room for a pool! Legally enlarged garage is currently used as a recording studio, but perfect for any creative use, home office, or possible ADU! Features include two large rooms with high ceilings, a storage room, laundry room, a 1/2 bath and plenty of attic storage. Not to be missed!
Have you had any thoughts of buying or selling a home or investment property? LA Creative Realty is a boutique real estate brokerage firm. We combine generations of real estate and investment experience with modern technology exceptional client relationships and thoughtful investing to deliver the dream home for our Buyers, the best prices for our Sellers, and the best returns for our Investors.
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Aegis Management DBA LA Creative Realty Lic. # 01932663
All material presented herein is intended for informational purposes only and is compiled from sources deemed reliable but has not been verified. Changes in price, condition, sale or withdrawal may be made without notice. No statement is made as to accuracy of any description. All measurements and square footage are approximate. Equal Housing Opportunity.
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