Property Prices in 2021: Why You Should Invest in a Home in California
Many people are out there today, taking advantage of the low mortgage rates to finally purchase a house or a property. Low mortgage rates just show how much the pandemic has affected this business but experts are saying this may change in the next few months.
Now, even if mortgage rates appear to be low in many states today, one state seems to still be doing great and still seems to have a strong real estate market. This is the state of California with a population of 39.5 million people.
How the California Real Estate Market is Doing
Now, California mortgage rates have always been quite higher than the rates in other states because everyone seems to want to move to cities like San Francisco and Los Angeles. However, things seemed to have changed since 2019. Based on reports, the state’s population hasn’t increased at all in 2019. The population has decreased because around 200,000 people moved to neighboring states like Colorado, Idaho, Arizona, and Utah with low housing costs and to simply find new jobs.
With the 15 million homes in the state, around a million would change owners each year. This is why the real estate market of California is hard to bring down. The housing market in the state was still able to finish 2021 on a high note and the median house price even reached yet another high record.
Then came 2021 when the state had its largest increase in real estate sales and pricing in 17 years. Based on reports, the year-to-date percentage of home sales in the state have already reached almost 16 percent in February.
How the Pandemic Affected California’s Real Estate Market
Like how things are in other states, realtors also had to cancel open houses in California properties. Because of this, there are agent reports that buyer interest went down. C.A.R also conducted a flash poll that found 54 percent of realtors had buyers who backed out from purchasing a new home because of the pandemic. Meanwhile, 45 percent said that they had sellers who also backed out from selling their properties.
Still, technology was able to help realtors get sellers and buyers. Virtual open houses took place and this was because real estate transactions including home purchases were allowed to continue despite the pandemic.
Overall, the pandemic did affect California’s housing for a while, but it was able to quickly recover months after the pandemic started. Eventually, there was once again a strong housing demand within the state.
Is it a Good Time to Buy a House in The Golden State?
We’d like to say that it is, but a better answer to this is that it depends on your priorities and your financial situation. Know that even if mortgage rates are low at the moment, it doesn’t mean that you also have to go out there and start house shopping.
It’s still better to treat the market like how people would during the pre-pandemic times. Experts suggest that the mortgage rates will eventually rise in a couple of months, but it doesn’t necessarily mean that it would do so highly.
When it comes to when you should consider getting a house anywhere in the United States, generally, people would say that the best time to do so is during the Christmas season and Easter. However, things are quite different in The Golden State.
If you’re aiming to buy a house here, the best time to buy a house is during the first few months of the year. This is because by April to June, the number of house listings is already quite high. If you’re unable to get a house during the earlier days of the year, you may try again during the winter months. Many sellers are quite in a hurry to sell their homes during this season and this may give you a good chance in scoring discounts.
Know that cities like San Francisco and Los Angeles have expensive houses because these are highly commercialized areas. If you’re on a budget or would like to find homes cheaper than the ones in those cities, you may consider looking in Irvine, Oxnard, Sacramento, Ventura, and Oakland.
If it’s your first time buying a house, even if it is outside California, you still should take the time to do your research about the prices of the houses in a certain area and potential lenders that would approve your mortgage application. If you want to make things easier and are willing to pay extra, you may consider working with a mortgage broker.