The market trends possibly occurring during the year will raise some eyebrows.
However, the concerns won’t dampen the LA real estate industry. Allow these concerns to become motivation for another great year in real estate.
Here are the top trends that I think are going to impact the LA real estate market:
Rising interest and mortgage rates
[Tweet “Mortgage rates will increase, so you can help buyers act quickly”]
Thanks to the Federal Reserve, expect a 1 percent increase in mortgage rates this year. Encourage buyers to seek low interest and mortgage payments now. Lock in those low rates; the mortgage rate will increase 1 percent this year and every year afterward.
Increase in rental property
Buyers prefer renting to scope out possible neighborhoods before buying. Since the rent is increasing, buyers cannot afford to rent very long. Even if you continue to find good prices, the rent often increases when the lease expires. Renters make the stressful decision to accept the new terms or move.
Likewise, renters who want to buy a home can’t afford it because of high rent costs and higher cost of living.
Increase of available homes
Yes, home sales are increasing.
A successful 2015 means fewer inventories to start 2016 and increased prices. While there are other reasons for the price hike, real estate agents need not worry. The prices won’t rise substantially, and it’s possible the low inventory won’t last year-round.
Virtual home tours
Here are a few reasons to do virtual tours this year:
- Attract residents and out-of-state buyers to your company with virtual home tours
- Convince sellers to create a video of the home
- Film the interior and exterior of the home along with the surrounding neighborhood
- Photos highlight a home’s best features; a video tour takes it to another level
Use your expertise
Use the creative part of your brain to sell homes.
Despite the trends, encourage buyers that ownership is better than being a tenant. The stability and freedom to relax in an enjoyable neighborhood are worth the investment. The Los Angeles market expects another stable year, and no change is good news.
With an influx of buyers coming in, 2016 is off to a promising start.
Tonya Jones is a writer who specializes in real estate. She has written various content for Textbroker, My SEO Articles and Blogmutt.