The Market Today in Southern California

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When will the market peak this year? What does the market climate look like today? We’ve certainly experienced some changes in the housing market recently compared to the last twelve months. If you had asked me the best time to buy last year, I would’ve told you the spring when there’s low inventory. Likewise, I would’ve advised that the end of summer is the best time to buy when there’s significantly more inventory.

However, 2016 will be different. In December, the Fed increased interest rates by 0.25%. They will most likely continue to raise rates until the end of the year. By then, they might hit 5% and remain high into 2017. The Fed wants to maintain market recovery by raising short-term rates. We’ve seen this in 1984 and 1994.

This impacts adjustable-rate mortgages. This will trickle into the higher mortgage rates towards the middle of this year. Nine to twelve months later, prices might start to slip. The California Association of Realtors predicts a 3% to 4% increase in home values in 2016. This will most likely happen between now and May. Inventory levels will have increased to a point where the market prices will stabilize. It’s difficult to determine when this will happen exactly.

If you’re thinking about downsizing or preparing for retirement, prepare to sell your home within the next three to four months. Give me a call or send me an email today! I can let you know what your property is worth. Take advantage of this opportunity.