How Is the 2018 Real Estate Market?

Los Angeles and South Bay Real Estate Video Blog with Lenny LaRocca

The 2018 real estate market started out with a bang. How are market conditions for buyers and sellers right now?

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What’s happening in the February real estate market? The new year started out with a bang. Historically, the market is slow at the start of the year and picks up towards the end of January or February. Right after January 1, 2018, we saw an increase in the number of homes for sale and the number of properties going under contract. All in all, the market remains strong. The economy continues to roar. However, the Feds are going to increase interest rates over the course of 2018, which will impact buyers and sellers. There are still a few favorable elements in our market for sellers. We are currently running around 18% less inventory for sale compared to this time last year, and we know that 2017 had even less inventory than the year before that. As a result, prices will remain high and strong, which is great news for sellers. Additionally, millennials are starting to enter the market, which is a strong element for our economy. That said, it looks like 2018 will continue in a seller’s market.

All in all, the market remains strong.

If you are a buyer, the good news is that interest rates remain low at around 4.25%. The bad news is that limited inventory leads to more competition, so you need to have all your ducks in a row when you enter the market. The other bad news for buyers is that the Fed has announced that they will increase rates again in 2018. Rates are expected to go up three to four times between now and the end of the year. Because we are running low inventory and buyers are having a hard time finding properties, we are starting to see more activity with pocket listings. By definition, a pocket listing is when a seller wants to sell but doesn’t want to go through the rigamarole of putting their house on the MLS and dealing with showings. We are definitely seeing an increase in pocket listings in the immediate market. In 2017, 15+% of homes sold were pocket listings. That means if you’re not working with a real estate professional who’s tapped into the real estate community, you will probably not know about these opportunities to buy a home. If you have any other questions about buying or selling a home in 2018, just give me a call or send me an email. I would be happy to help you!