The short answer is yes, it’s still a good time to buy a house in California. The longer answer includes a look at recent trends taking people away from the Golden State and the need to temper enthusiasm with smart decisions.
Trends to Note in CA Home Buying
Here are some recent trends to inform your decision:
- Typically, California mortgage rates run higher than other states. The average mortgage rates in California are 3.375% for early June, according to ConsumerFinance.gov.
- About 200,000 people have move to neighboring states such as Arizona, Idaho, Colorado and Utah since 2019. Some of these people left to find job opportunities, while others left for more affordable housing.
- According to the U.S. Census, there are approximately 13 million homes in California, with about 1 million of them changing hands every year.
To put all this into perspective, it’s important to understand how COVID-19 affected real estate in California.
California’s Post-Pandemic Real Estate Market
As the state continues to reopen, the economy and housing market are looking brighter than throughout the pandemic. However, labor and material shortages continue to keep supplies down and drive prices up. For this reason, it may take investors longer to find properties that will continue to rise and yield a hefty profit on resale.
Investors may be wise to move while there is still a post-COVID-19 glut of prospective home buyers eager to get into a home. The CAR predicts that as a supply of homes picks up, the market could slow down, causing downward pressure on prices.
Tips on House Shopping in California
Homebuyers and investors will have to continue watching the market closely and move quickly on properties that could yield higher prices in the near-term future. This means finding a knowledgeable real estate agent who can get you into homes before they hit major listings.
Investors or home buyers willing to make a move have more options. Commercialized areas such as Los Angeles and San Francisco may continue to see rising prices even if the rest of the state experiences declining prices. However, it may be a better bet to look in cities such as Sacramento, Irvine, Ventura, Oxnard, and Sacramento, where there’s reasonable demand without the 7-digit price tags that mark homes in LA and the Bay Area.
It’s also important to find a lender with a plethora of mortgage-related services and knowledgeable mortgage brokers who understand the current volatile housing market in California.
At Potempa Team, we offer mortgage-related services that include everything for pre-approval to assistance with conventional, VA, FHA and USDA loans. Whether you have a large down payment or need a jumbo loan to fund your purchase, our licensed mortgage brokers have your back. Contact us today to get started!