Real Estate is Seasonal
Category: Joe Pryor
Inventory Low, Prices High, Interest Rates Uncertain
The decrease in inventory over the last five years has resulted in prices increasing and staying high. Interest rates matter and they will force some buyers out of the market; however, there is an underlying demand for housing as long as the population is steady or increasing, employment remains steady, and unemployment is low. Our country is unrelentingly optimistic and refuses to accept defeat. We can expect great things.
Prices? These are rising.
Prices have increased overall in the last five years but there was a spike that took place after COVID-19. That rate, fortunately, did not continue. Prices typically take a step up in the first five months of the year, then level off and possibly sink a little at the end of the year when properties that have languished on the market have decided their price is above the condition it warrants. The market is still rational.
This chart shows the number of new listings (brown) in each of the last 12 months versus the closed sales for that month (gray). The months of December, January, and February flip and flop. January makes up for the sales lacking in December. What do you think after looking at the chart? Most listings sell! The market is absorbing the new listings. There is no trend downward. Listings are not sitting on the shelf. Prices should stay high and continue to increase.
What are the active listings in Laguna Niguel?
If you are interested in this beautiful city, you should familiarize yourself with the properties on the market over a period of time. There is a lot of variation and good deals go quickly.
Being near the coast of Southern California is just about the finest place to be on earth. I may be biased but it is true!
Take a look at the active listings currently on the Multiple Listing Service. Active listings
The homes start at $990,000 and go up to $39,995,000. Something for everyone!
If you are curious about the most expensive listing, you can click on 13 Old Ranch Road, listed by Tim Smith of Coldwell Banker Realty. The customer facing listing page of the MLS allows you to click through all the pictures and gives you the information you need to decide you want to see this home in person. I will arrange an appointment to show you this home as well as all of the others. You do have to be qualified to buy it before the owners will allow the showing, but many people are qualified.
New Listings are Down – Sales are Up
December was an excellent month for sales. Good new for sellers but distressing for buyers. Thirty-four homes were sold but only 17 came on the market in Laguna Niguel. This was the Christmas season and other holidays. Sellers and buyers were busy. Many of the sales were put in escrow in November, the average days in escrow were 30. But the result is there are fewer homes for buyers. Today there are only 43 homes on the market.
The median sales price was $1,507,500 in December.
The year ended just about exactly how it started. There was a spike during summer but it faded away and resumed the normal bumpy ride from month to month. This is actually encouraging because interest rates were rising and we could have had a downturn in prices.
If you would like to see the full report click here, Full Report You can choose between the number of properties and the median prices. Then you can scroll down and choose the month you are interested in. Below will appear all of the addresses and information. If you choose one of the addresses, click on the address and to the right a map will appear with a few details on the home and a picture.
If you click into the box where it shows “Detailed Listing”, you will see all of the pictures and the description and all of the details.
This report gives you a detailed analysis of every property and the market overall. It spans twelve months which puts any one month into perspective.
If you see a neighborhood you like, give me a call or send me a text. Cathleen Pryor 949 230-1834. We can chat about the area and how it could be perfect for your new home. Do you like close to the beach or prefer quick access to the freeways? The map is very helpful.
Panoramic View Condominium in Laguna Niguel Move-in ready!
The Market is Still Going Up but Starting to Calm!
Over the last year, home values have skyrocketed. It was dizzying. Across the board, homeowners saw a 30% rise in the value of their homes. People are starting to feel this must be the top of the market.
The first two months of 2022 show a small but steady increase in inventory.
Starting in June of 2022, sales outpaced new listings and our inventory of homes to sell kept dropping. It is still disastrously low but any improvement is a sign we could see a more balanced market before the end of the year. Rapidly escalating prices are a joy to homeowners but anxiety increases too. If people are contemplating retirement or moving closer to grandchildren, they feel pressured to take action or they will miss the top of the market. If they miss it, it may be another 5-7 years to see the top of the market again.
The overbidding of property is slowing.
While median prices are increasing, the sale price is matching the listed price for the first time in months. Sellers and their agents are pushing up the initial price but they appear to be on track with the buyers. The appraisers are doing their best to accommodate everyone because there are multiple offers, sometimes as many as ten or more. The banks and the secondary market do not have any worry about repossessing a property. There will be a lineup of people to buy it. Of course, underwriting standards are so tough, people are over-qualified before they are approved for a mortgage.
These graphs do not highlight the fact that only 23 homes sold. We should see 50-60 homes sell every month. That underscores the inventory problem.
If you would like to see the full report, click here Full Report
When you see the first page, scroll down and click on any address. The address has additional information. You can see the listed price and the sold price, the percentage difference and the days the home was marketed prior to accepting an offer.
| 2 Brownsbury RD | $2,795,000.00 | $3,065,000.00 | 9% | 9d |
After you click on an address, to the right a picture from the MLS will appear with a link at the bottom to give you access to the details and photos. The little box with the picture of the home is placed on a map to show you where it is.
On the opening page, you can change the month to any month in the past twelve months to see the activity.
Let’s take a look at the properties actively on the market! In Laguna Niguel there are 37 listings for sale. The most expensive home is listed at $50 million. It is beautiful! I am attaching this link which will take you to all the active listings, if you choose, and you can define the right property using the options. Active Listings
Steven Thomas -Reports on Housing
Steven Thomas is our Real Estate Economist. He specializes in several counties in Southern California. You can access his report and join to be fully appraised of the economics of our current real estate market and what it forecasts. Orange County Housing Report Above is his graph based on the data he tracks continuously and has done so for years. These are just the 2018, 2019, 2020, 2021 statistics. The inventory levels for each year are a different line. You can see how dramatic the decline in inventory is for 2021. We are scraping the bottom of the graph. The lack of homes on the market does force prices up. We need more homes on the market!
With the income protection program coming to an end ($300 weekly if you or a family member’s income was affected by Covid 19) and the eviction moratorium ending ( in a Court of Law it was found unconstitutional), more homes should come on the market. Some lower income people were making more money by taking government assistance than they were by working. Now all those workers, many in childcare, are back seeking employment. The schools are all open so children do not have to be supervised by their parents during the day. Those parents can go back to work. There should be plenty of childcare workers available.
About a million homes were in forbearance as we started September, those people now have to catch up on their mortgage payments or sell their homes. Lenders are due the full amount owed for the mortgage payments deferred. Eviction does take a few months but the courts are open so those will now happen. The good news is the appreciation in home values should allow the delinquent homeowners to pay the lender in full and have cash toward their next residence.
The Fall Market is starting to cool
Fall starts now. The recovery from the height of the pandemic has been slow for real estate in terms of volume. However, low inventory pushes up prices especially when you have historically low interest rates.
As you can clearly see, once we got released from a general quarantine to go back to work, prices recovered then climbed. We started at under $1 million a year ago and we are now at the $1,350.000 range. Interest rates are historically low. The monthly payment has dropped for loans of $800,000+ from what it was just a few years ago. More people can afford to stay in their homes longer. Every time you refinance, the loan is extended out for another 30 years. Assuming you had paid down your house somewhat since the last loan took effect, you are refinancing less of a loan and extending the payment horizon out 30 years.
Because the Federal Government does not allow lenders to discriminate based on age, you can be 90 years old and qualify for a 30 year loan. There is literally no end to when you can refinance as long as your credit remains good and you have sufficient income.
If you would appreciate seeing the entire report go to Report. Scroll down and choose the month that interests you from the drop down menu. The list of all properties that sold will appear with the sold price. If you click on an address, you will see an icon appear on the map of Laguna Niguel. Click on the Detailed Listing link. You will see all the details as well as the pictures. You can do this for each of the last twelve months.
When you visually see the 30%+ appreciation in just one year’s time, it is astounding. Many people could not afford to buy the home they live in. Fortunately, the property taxes are limited to a 2% increase annually despite the appreciation in value. And people who are 55 years of age or older and move their property taxes with them to a replacement home. This gives retirees incentive to leave large homes and find smaller, one story residences without facing a huge increase in their property taxes.
The most expensive home that sold last month was 35 Vista Montemar. This home sold for $4,100,000. The average home only took 24 days to sell in August. This home is a super luxury home and it was on the market for 64 days. That is not a lot of time.
If you would like to see the current active listings for single family homes, click here, homes. There are currently 47 homes on the market. If you are interested in seeing one of these homes, give us a call or send us an email. Homes go quickly. If you need financing, we can offer you our contacts within the lending industry that can get you the best rates and give you amazing service. Don’t delay.
Laguna Niguel is beach-close, beautiful and much more affordable than the beach cities. Laguna Niguel movie
Please join us! Let us know if you would like to see any homes to purchase. Expect the process to be very fast!