Making the decision to invest in Los Angeles real estate is huge. There are a lot of factors you need to consider to get the best deal and feel entirely happy with your purchase. Any realtor will tell you the location is one of the most important aspects, but timing may also have a significant influence on what you pay.
So is 2016 a good year to buy? Let’s look at the Los Angeles real estate trends for this year to find out.
Los Angeles Real Estate Prices Are Likely to Stabilize
The California Association of Realtors predicts that the state’s median home price will rise by 3.2% this year. The price increase means that fewer families will afford to buy a home, but there is an advantage to this. Bigger prices reduce the demand, which means sellers will have to be more open to negotiations if they want to make a sale.
The prices in the Los Angeles real estate market will most likely continue to grow over the course of this year. However, the prices are expected to stabilize, and we probably won’t see big fluctuations on the market.
Rents Will Go up Even Higher
At the beginning of 2015, the rental vacancy rate for metropolitan Los Angeles was 3.8%. According to data released by The Census Bureau, the rate dropped to 2.7% by the end of the same year.
Therefore, we can expect the rent supply to be even lower this year, which will make landlords more likely to raise the prices.
People usually rent hoping to save money to buy a home later on. With rents increasing, a big part of their funds will go towards paying rent, and they will no longer be able to put enough money aside.
So if you are waiting for the right time to make the transition from renting to owning, now is when you should do it.
Increase in Listings Will Ease Competition between Buyers
The number of homes for sale has increased by 10.3% compared to the same time last year. For those who can afford to buy a home in Los Angeles this year, this is great news because more supply usually means less competition.
However, you should keep in mind that less competition doesn’t mean zero competition.
If you are interested in buying a new home and want to get a great deal, it’s important to try and find ways to get a competitive advantage over other buyers. Consider working with a skilled realtor who has plenty of market experience and who can help you close the deal.
To Sum Things up
The forecast for the Los Angeles real estate market in 2016 opens the door to new and exciting opportunities.
Increasing rents might give renters an incentive to turn into homebuyers. Housing prices are expected to level off and stagnate, and homebuyers have reasons to hope for less competition on the market.
Taking all the data into consideration, I would say now is a great time to explore your options and start looking for your dream home in sunny Los Angeles.
If you are considering buying a home soon, don’t miss out on the chance to receive a free list of properties for sale in Los Angeles.