What’s Up with Real Estate?
National news and local views for the week ending Friday, January 12, 2024
Happy Weekend! This past week was the coldest so far, but real estate activities has warmed up a little. We're seeing increased inquiries and showings. Although we expect the interest rate to remain between high 5s to mid 6s, we consider this to be a modest interest rate and consmers will adapt.
National Real Estate News
Core inflation eases
The CPI (Consumer Price Index) report saw core inflation (excluding food & fuel) ease from +4.0% YoY in November 2023 to +3.9% YoY in December 2023. As a reminder, core CPI peaked in mid-2022 at 6.6%. [Source: BLS] While 3.9% is still a long way from the Fed's 2% target, the downward trend is clear. The Fed is almost certainly done raising rates. The only question is WHEN they start cutting.
Settling below 7%
Average 30-yr mortgage rates have moved up slightly to 6.78%, but remain well below their recent peaks of just over 8%. [Source: Mortgage News Daily] While Fed members continue to talk tough on inflation, the market is still expecting rate cuts to begin in March, or at the latest May. Wouldn't it be great if we got lower rates AND more inventory this spring/summer selling season?
Unlocking inventory?
A big reason why the 2023 spring/summer selling season was disappointing was that we didn't get enough new listings. Many would-be sellers felt 'locked-in' by their low existing mortgage rates. But with the big move down in rates recently, things look to be improving. In December 2023, new listings were up 9% year-over-year and total inventory was up 5% year-over-year. [Source: Realtor.com]
Local Market Trends
As of Friday, January 12, 2024
| Area | Median Price | Active Listings | New Listings - 5 days | Median Days on Market |
|---|---|---|---|---|
| Diamond Bar, CA | $1,035,000
-0.1% |
61
-0.3% |
8 | 54
-0.1% |
| Walnut, CA | $1,378,000
0% |
23
0% |
2 | 49
0% |
| Irvine, CA | $1,490,000
0.1% |
177
0.3% |
35 | 31
-0.3% |
| Newport Coast, CA |
$19,980,000 |
27 |
1 |
100 |
Local Market Trends (/) from Dec. to Jan. 2024.
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