SoCal Beach Cities Market Report 122922

Dated: December 29 2022

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Beach Cities Market Report

Residential / Luxury / Investment
Call/Text   714-955-1393

5 Reasons This Isn’t a Repeat of the 2008 Housing Crash:

Many homeowners are still haunted by the 2008 housing crash when property values collapsed and foreclosures spiked. 

Are their fears well-founded?

“It’s a valid question,” Lawrence Yun, chief economist for the National Association of REALTORS® offered assurance that current dynamics are nothing like during the Great Recession. He pointed to several key indicators of how this market differs.

  • The labor market remains strong. In the last major housing downturn, there were 8 million job losses in a single year. Now there are virtually none. Though layoffs in the technology and mortgage industries are occurring, they haven’t accumulated enough to form a net job loss, Yun noted. A strong job market bodes well for housing’s future.
  • Less risky loans.  the subprime loans that were prevalent during the 2008 housing bust are basically nonexistent today.
  • Underbuilding and inventory shortages. New-home construction prior to the 2008 crash was amounting to 7.65 million units annually. Today, it’s 4.6 million. Yun points to “a massive housing shortage” from a decade of underproduction in the housing market.
  • Delinquency lows. About 10% of all mortgage borrowers were delinquent on their loans in the previous housing bust. The mortgage delinquency rate is now at 3.6%, holding at historical lows.
  • Ultra-low foreclosure rates. Homes in foreclosure reached a rate of 4.6% during the last housing crash as homeowners who saw their property values plunge walked away from their loans. Today, the percentage of homes in foreclosure is 0.6%—also at historical lows. He predicted foreclosures to remain at historical lows in 2023.
Overall, the fundamentals don’t point to a housing market that is operating similarly to the 2008 cycle, Yun said. While home sales are slowing, prices remain up nearly 6% as of October sales numbers compared to a year ago. Also, inventory remains low, which will keep home prices elevated, Yun said. “The chance of a price crash is very small due to the lack of supply.”
2023 is going to be Great!!! I am wishing you and your family the happiest New Year and appreciate our friendship.

I look forward to helping you in the coming year.

Reach out anytime.

Be Well, Stay Safe!

>>>>LA & Orange Counties<<<<
689 Closed Sales Last Week!!!
3,963 Closed Sales MTD


Number of Months of Inventory = 2.2

Average Days on Market = 35
Active Listings "Stats"
12/22/22 - 12/28/22
Orange County
Single Family Residence - 25
Townhome / Condo - 24

Under Contract this Week - 117
Los Angeles
Single Family Residence - 127
Townhome / Condo - 43
Under Contract this Week - 377
Data Source:  CRMLS
Interest Rates
Changes from Previous Week
30 Yr Fixed - 6.54%     +0.26
15 Yr Fixed - 5.85%     +0.30
FHA 30 Yr - 6.11%       +0.24
Jumbo 30 Yr - 5.70%   +0.20
Data Source: mortgagenewsdaily
Homes For Sale
"Easy Links"
Data Source:  CRMLS
Orange County

Los Angeles County
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