(Oct 26, 2021)
PDG Dave Moyers, a local realtor with RE/MAX at 450 Silver Spur Rd in Rancho Palos Verdes, spoke to us about changes in the current California housing market. In summary, from 2015 through 2021, the Median Price of homes has increased from $476,000 to $793,000, while buyer Affordability has decreased from 31% to 26% of the population. Mortgage rates have changed from 3.90% to 3.00%. The number of Single Family Home Resales has increased from 409,000 to 440,000.
In spite of (or because of) the COVID pandemic, 20 cities in California grew by over 40% last year (with mobile professionals moving to less-congested areas to work virtually). The average size of homes purchased also jumped from 1745 ft2 to 1800 ft2. First-time buyers have also been making higher down-payments, and 6.6% of home purchases are now for 2nd/vacation homes (showing increasing income disparity). Coastal areas are increasingly unaffordable for first-time working-class buyers, so more buyers are moving farther away (to rural areas and/or out-of-state) to find more-affordable real estate prices.
Home-owners are now staying in their homes longer (changing from 5 years to 11 years average). The California population since 1986 has increased from 27 million to 40 million (& the number of realtors has increased with it), but the rate of new building permits has fallen with the decreasing availability of suitable new-housing areas. (For example, burn-susceptible areas are becoming less desirable with increasing wildfires.) As housing-market prices go up, buyers have become more discouraged, while sellers have become more encouraged.