I Want To Buy A Home In LA Now: How Does The Market Affect Me?

Hollywood

Trying to find the right home to buy in the right neighborhood in Los Angeles can be overwhelming. With well over 400 neighborhoods and 88 different cities, there are a lot of factors to consider. 

According to year-over-year sales reports, the median sales price in L.A. dropped about 7% between summer 2022 and summer 2023. The number of homes sold in Los Angeles also dropped by about 24% during the same time. 

The important thing to consider is: how do these trends affect me?

Look for transitioning neighborhoods

Median home sales prices in California have increased by $330,000 since 2016 according to Bankrate. That’s a statewide average, and it isn’t true in every neighborhood in Los Angeles. Several transitioning neighborhoods haven’t yet experienced that level of price increase. These neighborhoods could represent the best value for your home buying dollar.

Glassell Park is an up-and-coming neighborhood close to downtown Los Angeles. Mar Vista is a westside neighborhood that’s close to several employment centers, beaches, and the Marina.

Consider a condo or townhome

If you’re interested in the condo lifestyle, there are a number of condominiums and townhomes for sale in Los Angeles, including in excellent, in-demand neighborhoods. According to Redfin, while the median sales price for single family homes declined between 2022 and 2023, condos increased slightly. There are fewer condos on the market than single family homes right now, and it may be possible to find an excellent value in condominium right now.

Identify important quality of life factors

Your home’s location is important, especially when you’re considering factors like commute time, schools, and amenities. Other factors to consider include potential fire and flood danger, as well as taxes and assessments from special districts. Throughout the greater Los Angeles area, you may be able to locate a home that enjoys benefits of nature, but isn’t in a difficult-to-reach area or one that could be subject to severe flooding.

Work with qualified, experienced professionals

The Los Angeles home buying market has been described as a “rollercoaster” by industry analysts. However, there are professionals who understand the ups and downs of the market and who are able to guide you to the best combination of home price, location, and all of the other qualities you desire. California Platinum Realty can assist you in finding the right property, and California Platinum Loans have access to many funding options. Contact them today to start your Los Angeles home buying journey.

Sources

McMillin, David. “Buying a house in Los Angeles,” Bankrate, url: https://www.bankrate.com/real-estate/buying-a-house-in-los-angeles/

Redfin. “Los Angeles Housing Market,” url: https://www.redfin.com/city/11203/CA/Los-Angeles/housing-market

California Platinum Loans

  https://californiaplatinumloans.com

Interested in jumbo mortgages in Los Angeles? Check out our latest article answering six common questions about these big-ticket loans!

With median home prices at over $900,000 in Los Angeles County, jumbo mortgages can be required for many buyers to finance a home purchase.

What are jumbo mortgages?

A jumbo mortgage is any mortgage which is greater than the annual loan limits published by the Federal Housing Finance Agency (FHFA) each year. Jumbo mortgages are not underwritten by Fannie Mae or Freddie Mac, the two federally-chartered home loan organizations that insure or back “conforming” or conventional mortgages that are less than the FHFA’s annual loan limits.

How much can you borrow on a jumbo mortgage?

Jumbo mortgages start at $1,089,300 in Los Angeles County for a single family home. You can borrow $2 million, $3 million, or more for a jumbo mortgage, depending upon your qualifications and income.

What are jumbo loan requirements?

You may find some online resources which say you need a minimum credit score of 700 for a jumbo mortgage. Jumbo loan requirements can be different from conventional mortgages, usually because the loans aren’t government-backed, which increases lender risk.

Jumbo loans also require favorable debt-to-income ratios, usually no higher than 43%.

Do you need perfect credit for a jumbo mortgage?

You do not need “perfect” credit to qualify for a jumbo mortgage, but the better credit you have, the greater your choices of mortgage term and lender will be. Some lenders do require a minimum credit score of 700, but others are more flexible.

What are down payment requirements for Los Angeles jumbo loans?

You will need to have sufficient equity to qualify for a jumbo mortgage. In the past, many jumbo mortgages required a 30% down payment. This is no longer the case and you may find lenders with more flexible down payment terms ranging from 15% to 30%.

How do you qualify for a jumbo mortgage in Los Angeles?

The optimal way to qualify for a jumbo mortgage in Los Angeles County is to work with a qualified and experienced mortgage broker. They can guide you through the process of obtaining a jumbo mortgage to buy the property that you want and need. Work with California Platinum Loans to discover the many financing options that are available to you.

Sources:

St. Louis Federal Reserve [FRED], “Housing Inventory: Median Listing Price in Los Angeles County, CA”

Fannie Mae. “Originating & Underwriting: Loan Limits”

California Platinum Loans

  https://californiaplatinumloans.com

Four Fascinating Facts About the Los Angeles Home Market That Will Surprise You

Los Angeles

Did you know that Los Angeles County was one of the harder-hit regions in the 2008 global recession? According to the First Tuesday real estate site, it took the County over 6 years to recover the number of jobs it had before the economic downturn. The one thing we can say about the LA residential real estate market is: it’s never standing still.

Los Angeles Housing Market Doesn’t Fit The National Mold

In 2020, home sales across the U.S. boomed because mortgage interest rates had reached historic lows. However, in Los Angeles, sales declined from the previous year.

The main cause? job losses resulting from the 2020 global pandemic. The pandemic also led to many sellers stepping back,  choosing to wait for the pandemic to be over. 

Today’s Home Sales Volume is Half Its Peak in 2003

How far back? Today, the 6-month rolling average for LA home sales is about 60,000 per year. The peak year for LA-area home sales was back in 2003, when over 125,000 homes sold.

About 5% of Homes Are On Sale At Any One Time: More Sales Are Predicted by 2025 or 2026

According to First Tuesday real estate education website, the recent California eviction and foreclosure moratoriums artificially impacted turnover for both homeowners and renters who were looking to move into homeownership. However, homeowner turnover rates tend to hover in the 5% range. That means that at any one time, about 5% of LA-area homeowners are looking to sell their homes. First Tuesday predicts that a more stable financial recovery will begin by 2025 or 2026.

Thousands of Baby Boomers Will Impact the LA Real Estate Market

The youngest Baby Boomers are expected to retire in 7 to 10 years, between 2030 and 2033. Los Angeles ranks #15 on the list of large cities with big population of Baby Boomer homeowners. While only 18.3% of LA’s population are Baby Boomers, they own over 40% of the city and county’s homes. There are over 208,000 Baby Boomer-led households in the county. As this group chooses different housing, they are certain to affect the home buying and selling market. 

California Platinum Loans/California Platinum Realty have years of experience in the Los Angeles home buying and selling market. You can rely on their expertise and commitment as you find your own best financial and residential place in the ever-changing Los Angeles community.


Sources:

ft Editorial Staff. “Los Angeles Housing Indicators,” First Tuesday Journal (ft), 13 February 2023, url: https://journal.firsttuesday.us/los-angeles-housing-indicators-2/29229/

Gale, William G. “The Aging of America: Will the Baby Boom Be Ready For Retirement?” Brookings Institution, 1 June 1997, url: https://www.brookings.edu/articles/the-aging-of-america-will-the-baby-boom-be-ready-for-retirement/

Jones, Jonathan. “Baby Boomer-Dominant Housing Markets,” Construction Coverage, 7 March 2023, url: https://constructioncoverage.com/research/baby-boomer-dominant-housing-markets-2020

California Platinum Loans

  https://californiaplatinumloans.com