🤔 What’s ACTUALLY happening in the real estate market?
With all that’s going on in the financial news…
…you might be feeling a bit unsettled.
That’s why I’m breaking down what’s REALLY going on in our local market.
👀 And be sure to catch the end of this video where I share the 2 critical factors…
…for selling your home at the highest price in this current environment.
Hi, it’s Eva Lin.
Before I jump into the local sales data, I want to point out 3 things you should know…
…about the real estate market in general.
1⃣ Mortgage rates are tied to inflation.
When inflation goes up, mortgage rates follow, and this causes house values to drop.
On the flip side, when inflation goes down, mortgage rates also go down, and house values rise.
The way inflation is calculated is quite complicated.
What’s important to understand is the calculation includes data from up to 12 months back.
Based on how the calculation works, it looks likely that by summertime…
📉…the inflation numbers will drop considerably.
And, as I mentioned, mortgage rates follow inflation.
So that means a lot more buyers jumping into the market.
More buyers = more demand.
And more demand = higher prices.
2⃣ Each 1% drop in mortgage rates = 5M more home buyers entering the market.
If rates drop down to the low 5’s by summer…
…that means an additional 10M home buyers bidding on properties.
Housing inventory is ALREADY very low nationally and locally.
There are only about 1M houses for sale right now in the US.
🏡 And nearly half of those are in escrow.
That’s simply not enough available housing in a country with 340M people.
So, don’t be surprised if a slow spring market turns into a hot summer market…
…when the inflation numbers drop.
But what if we’re in a recession when summertime rolls around?
According to the financial news, this looks like it could be the case.
3⃣ Mortgage rates fall during recessions.
It’s likely that 1.5M people will temporarily and sadly lose their job in the recession.
At the same time, lower rates will cause millions more buyers to enter the real estate market.
Based on the current trends, I think there’s a strong chance…
🔥…our local real estate market heats up significantly as the year progresses.
As for present day, we’re seeing 2 factors play out across Pasadena, San Marino, South Pas, and La Cañada.
With mortgage rates back in the 7’s there are fewer active homebuyers out there.
And homebuyers are cautiously taking their time (which wasn’t an option last spring).
In Pasadena, for instance, just 31 houses sold last month.
That’s almost a 50% decline compared to the same month last year.
In La Cañada, just 3 houses went into escrow last month.
😲 Compare that to the 19 houses that went into escrow in February 2022…
…and you can see just how much slower the current market is.
It’s also important to note that fewer houses are going up for sale.
For instance, in Pasadena, 61 houses went up for sale last month…
…while 84 went up for sale in February of 2022.
In San Marino, La Cañada, and South Pas the drop in new listings is even more dramatic.
👍 This is actually a good thing for home values, and here’s why:
We already know that buyer demand has dropped off due to higher mortgage rates.
But, with fewer houses for sale, home prices haven’t fallen as much as they otherwise would have.
For home sellers, achieving the highest price possible in THIS market…
…requires two critical elements.
✨ First, your home must be beautifully packaged and presented to the market.
This goes far beyond your standard photos.
Your multi-million dollar home should have its own digital story book complete with:
✅ Engaging video assets, and
✅ Strategic copywriting
All the marketing should be meticulously crafted so buyers can…
…envision the beautiful future that awaits them in YOUR home.
It’s all about getting home buyers to connect on an emotional level.
Second, you need to leverage a strategic offer price that’s attractive to buyers.
🙌 The price should encourage maximum viewings and multiple offers…
…that bid the final sales price up to its peak level.
Just this week, I helped my clients at 1723 Euston Road in San Marino sell their home for $3.2M.
The sale price was $300K over the asking price.
They quickly received multiple offers and enjoyed a great result even in this slower market.
💪 That’s all because they had the RIGHT pricing and marketing strategy working together.
And that’s not just a fluke!
A few weeks ago, my clients at 1234 Rock View Street in Eagle Rock had the very same experience.
I helped them sell their home for $2.73M which was more than $500K over the asking price.
They were also thrilled with the outcome, as you can imagine!
Again, it all came down to applying the right strategy.
🏡 If you’re planning to sell your home this year…
…I invite you to reach out to me for a complimentary consultation.
You can find me at LinRealtyGroup.com
Thank you so much!