The Southern California Real Estate Bubble?
While new home sale prices are declining throughout the Nation, new home prices in Southern California continue to rise. Likewise, as the sales of new homes continue to lag across the Country, even in the West, it is less of a problem in Southern California, where "sales of new single-family houses and condominiums saw their strongest February since 1988, according to statistics compiled by real estate research firm DataQuick Information Systems. Last month, sales rose 9.5% to 4,980 from January's 4,550, and were up 19% from the year before." (LATimes)
Moreover, while the surplus of homes is building across the nation and in Southern California, the surplus is much lower from Ventura County down to Mexico. Thanks in large part to strict building standards in Southern California, there just hasn't been the same level of new housing development in the area, which makes Southern California real estate that much more valuable.
Recently I reported that even UCLA isn't predicting much of a crash in the So Cal real estate bubble. Essentially, they predict less appreciation in home prices for the next couple of years, but no real price declines.
While the easy money has probably been made in the Southern California real estate market, the market still appears very strong. Sure prices might flatten for a few years, but with the population growth expected throughout the area, the value of Southern California real estate will eventually continue to push upward if new home building continues to be limited.
Sure waiting a few years might bring a small recorrection in the price of homes in some areas of Southern California, but will that be enough to make up for several years of paying rent? Additionally, even a small drop in home prices might not mean anything if interest rates on mortgages keep rising.
Need a Los Angeles Mortgage Broker?
Moreover, while the surplus of homes is building across the nation and in Southern California, the surplus is much lower from Ventura County down to Mexico. Thanks in large part to strict building standards in Southern California, there just hasn't been the same level of new housing development in the area, which makes Southern California real estate that much more valuable.
Recently I reported that even UCLA isn't predicting much of a crash in the So Cal real estate bubble. Essentially, they predict less appreciation in home prices for the next couple of years, but no real price declines.
While the easy money has probably been made in the Southern California real estate market, the market still appears very strong. Sure prices might flatten for a few years, but with the population growth expected throughout the area, the value of Southern California real estate will eventually continue to push upward if new home building continues to be limited.
Sure waiting a few years might bring a small recorrection in the price of homes in some areas of Southern California, but will that be enough to make up for several years of paying rent? Additionally, even a small drop in home prices might not mean anything if interest rates on mortgages keep rising.
Need a Los Angeles Mortgage Broker?
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