Prices continue upwards and So Cal's housing market shows no signs of a slow down.
Inventory in Southern California remains low and buyer demand is consuming these homes at a high rate, leaving just 2.8 months of housing supply. An even market is when there is a 6 month supply of houses, with 2.8 months it is a seller's market and buyers compete for what's available.
With this stronger economy we are seeing the return of new houses being built, a sure sign that things are better. However, this time the builders are doing things a bit different, they appear to be pre-selling everything they build. This allows them to adjust easier to current market trends, building at a pace that keeps their inventory from sitting. This is likely a model that they’ll stay with because it works in their favor, giving them the ability for moderate price increases more often, while still pre-selling.
When looking at the Yucaipa real estate market and compare the 2nd quarter sales to what is currently available, you’ll have a clear picture of what the market is doing and where the market is likely headed. The second quarter produced 203 homes sold in Yucaipa, at an average price of $315,500 with average Days on Market (this is the days it took before the home was sold) of 74 days. The current market shows that we have 209 homes for sale in Yucaipa, at an average asking price of $418,800; we also see that already in the 3rd quarter (started July 1st) we have 126 homes in escrow and an average price of $338,600 and an average market time of 81 days.
When looking at the data above we can understand what the current market is doing and where it’s likely headed:
- There is a 5% increase in price over the 2nd quarter when compared to the homes currently in escrow.
- The number of homes currently available for sale simply replaced the inventory which was previously sold, meaning less than 3 months inventory is remaining the “norm” and a seller’s market will continue.
- When looking at the current “asking price” of homes for sale it indicates a yet another future price increase that will likely show up by the end of the 3rd quarter.
It is obviously impossible to see into the future, however by using data and trends it is possible to reasonably determine what could happen. During the first quarter of 2015 sales in Yucaipa increased by 3 %, then there was the increase of 5% in the second quarter and we are seeing the possibility of another 5% increase within the 3rd quarter. Even if the market goes flat in the 4th quarter we could be looking at an increase of 13% locally, in Yucaipa, Redlands and Beaumont. This is very local information, not the normal articles on the Real Estate in the OC, L.A. or San Francisco but right here in our own city.
What does this mean to you? Well, if you’re thinking about purchasing a home you should commit to actually doing it, because the sooner you do than the better deal you’re likely to get. For those that own a home and are thinking about buying something larger, you would be wise to get your current home sold and new home bought because it’s a stronger investment to maximize on your current and minimize your expense on a bigger home. For anyone looking to purchase a home, there is a “critical unknown” which is interest rates, because when interest rates go up it automatically increases the cost of ownership.
The best time in recent history to purchase a home was in 2009, the second best time is RIGHT NOW
That’s my 2 cents … you can keep the change J
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