If you've been wanting to buy a new home in Los Angeles but have been too afraid to get involved in a red-hot bidding war, it's time to come out of hiding.
Over the last couple of years, buying real estate has become a competitive sport thanks partly to historically low mortgage interest rates triggered by the pandemic. According to a Doug Elliman report, bidding wars in Los Angeles peaked last quarter, but luckily for potential buyers, this trend will be cooling down a bit now that interest rates have gone back up.
For those looking to sell their home, this likely means forgoing the practice of setting the listing price under market value in the hopes of triggering a bidding war. This strategy, also known as "testing the market" might have worked when there was high demand and low inventory, but with average interest rates for a 30-year fixed mortgage hitting 6.7% compared to 3.3% at the start of the year, demand for housing has lessened. To learn more about why testing the market during these times is a strategy that could do more harm than good, you can check out this article.
This isn't to say that the Los Angeles real estate market is bad for sellers, just that it's stabilizing. As for buyers, yes, interest rates are up, but that does provide the good news that now you have the luxury of taking your time looking for a home you really love. Before, buyers often had to make a snap decision to pay over the asking price right there at the open house! So if you're looking to buy a home in Los Angeles, it's still a great time to do it, and--bonus--you can leave your suitcase full of cash at home. Email us or gives us a call at (323) 412-9060 and let's get started!Posted by Ben Nicolas on