Home prices have become a major boom for those residing in Southern California, especially during recent times. According to a few experts, home sales increased by double digits for the fifth consecutive month in January. Compared to a year earlier, the sales of homes jumped by double digits due to the extremely low mortgage rates created during the prior year.
The mortgage rates were an advantage to prospective buyers who capitalized on it.
In January, the Data firm DQNews released the increase in median home price and sales data of the six Southern California counties from a year earlier. Compared with the recently released data, there is a 13% rise in the median home price.
With this data, it is evident that housing sales have become a hot market as January marked the fifth consecutive month of a double-digit increase in the median home price. This increase has sent Southern California residents to a frenzy; hence, an urgent reason to look into it.
The Possible Causes
Experts have researched the possible causes of the surge in home sales during the pandemic and realized several factors contributed to it. Here are some of them:
- During the pandemic, borrowing costs saw a drastic dip as the average rate on a 30-year fixed mortgage dropped below 3% for the first time ever. This led to increased mortgage rates, which potential buyers capitalized on, leading to a competitive market.
- The compulsory stay-at-home orders led to many people needing to buy homes as they wanted to expand their spaces. From first-time homebuyers to others, various demographics were able to purchase new homes and are still buying. While those whose income plunged, they relied on government relief, which helped minimize issues in the real estate market.
General Data on Median Prices and Sales in all Six Southern California Counties
- In Los Angeles County, the median price rose 12.6% to $690,000, while sales climbed 14.3%.
- In Orange County, the median price rose 6.7% to $799,000, while sales climbed 22%.
- In Riverside County, the median price rose 17.1% to $455,364, while sales climbed 10.1%.
- In San Bernardino County, the median price rose 11.8% to $402,500, while sales climbed 20.7%.
- In San Diego County, the median price rose 9.4% to $640,000, while sales climbed 1.8%.
- In Ventura County, the median price rose 11.2% to $655,000, while sales climbed 16%.
What to Expect in 2021 as the Pandemic Continues
There is no specific date when social distancing measures and other restrictions will be a thing of the past, nor is there fixed data on how high home sales will progress. Some experts believe that housing will continue to stay healthy and robust on expectations of an improving economy. They think that there will be continued low mortgage rates, and home prices will remain steady as the economy improves.
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