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2018 Real Estate The Year in Review

From New Style Trends...

To New Sales Trends...

Let's Dive In...

3/4 of the way through 2018, every single Realtor in Southern California started double checking the listings, prices and inventory, and came to the same conclusion:

The market has Peaked. Buyers drew a big red line in the sand that many refused to cross. Most had no choice: interest rates pushed them out of the market.

A market grown spoiled by interest rates as low as 3.31% had climbed to 4.08% a year ago.

They've Risen and then fallen to 4.62% Now...

Buyers were going into shark frenzy mode because they heard the Fed would continue raising interest rates multiple times in 2018. That's exactly what the Fed did.

The difference in price from 4.1% to 5.1%......$300/month (and $108,000 more in interest over 30 years).

4.1% sounds GREAT right about now, yes? The lesson: Don't wait until 5.1% sounds awesome....
Don't forget.. mortage insurance and other expenses are added to this.

2018 Saw Massive Advertising From Discount Brokerages

As a Keller Williams agent, I am very pleased our company got a head start on technology that will offer services and data that will leave the discount agents wondering what hit them. If you've considered one of those companies, just remember that saving $6,000 on a commission (for example) while selling for $36,000 less is not a win for you. Especially when, in 2019, homes will not be flying off the shelves the way they have in the past 5 years. Homes for sale will need full-service marketing and negotiation from a skilled agent to earn the top dollar for your home. That example above? It happens, every day, with discount brokerages. Think about it. If they can't even protect their sole source of income, what will they do when the time comes to protect you? Plus, there are devilish details such as lengthy contract periods and payment arrangements where you pay whether the home sells or not. At KW, we will make your life far easier, and save you that money in other ways:

  • We will be offering NO-COST Loans.
  • 24/7, our new Kelle Data Cloud is collecting millions of bits of new real estate data allowing agents like myself to pinpoint the perfect home and price for my buyers, and offer unparalleled insight into home pricing for my sellers, starting in March.

Home Buyer Statistics

Sellers: Beautiful photos might just be the most important thing your agent can make sure you have.

In 2018, there are approximately 118 million occupied housing units in the United States, according to the 2018 American Housing Survey. The typical owner-occupied home was built in 1977; the typical renter-occupied home was built in 1974. The typical home size nationwide is 1,500 square feet, but in Santa Clarita, it is 1900 square feet. The typical home owner is 55 years old, and has lived in the current home for 13.6 years.

Facts About First-Time vs. Repeat Buyers:

  • First-time buyers: 34%
  • Median age of first-time buyers: 32
  • Median age of repeat buyers: 54
  • Median household income of first-time buyers: $75,000
  • Median household income of repeat buyers: $97,000
  • The typical home purchased was 1,870 square feet in size, was built in 1991, and had three bedrooms and two bathrooms.
  • Among those who financed their home purchase, buyers typically financed 90% of the home price.
  • 87% of buyers purchased their home through a real estate agent or broker—a share that has steadily increased from 69 percent in 2001.
  • Buyers who would use their agent again or recommend their agent to others: 89%

Did you know?

According to the 2010 Census, the Los Angeles metropolitan area had a population of more than 12.8 million residents, while the larger metropolitan region had an estimated population of 18.1 million. Los Angeles has 272 distinct neighborhoods, with various characteristics and the LA Times has a great interactive guide to them.

Room to Breathe...

Where is there the most space... and the fewest people per square mile? Take a look..

Santa Clarita is ranked 202nd out of 265 areas in density. There are 63 areas less densely populated than the SCV in LA County..

Statistics From Afar: The 2 Valleys compared

Santa Clarita homes cost over $100 less per square foot of living space.
Circle J Ranch climbs to the top position in price per square foot. A year ago, nearby Placerita Canyon, at $371/psf was the highest. It has dropped to $329/psf.
Santa Monica is hardly the place for a first-time home buyer to look, it just happens to place 7th among LA County cities for 27 factors including price and median household income...

Above, a look at the "attractiveness" of various cities from a first-time home buyers viewpoint. Lancaster is for some, a paradise of wide open spaces where you can live in a big modern home, and be left alone. Others will find commuting and reported crimes a deal-breaker. Santa Clarita places a very respectable 3rd due to its better schools, safety and livability scores than virtually other LA County city.

Hot Selling Areas

For the calendar year 2018, a few homes in Old Town Newhall and in Castaic Junction real estate sold faster than anywhere else in the SCV. Below, is how it looked a year earlier.

A basket full of Valencia neighborhoods dominated the list of fastest selling areas in Santa Clarita in 2017, with no Castaic neighborhoods on the list.

The Hottest Selling Areas in the SCV - 2018

  • Newhall 1 is basically the neighborhoods south of Lyons Ave.
  • Newhall 4 is generally East Newhall including Friendly Valley (Via Princessa)
  • Newhall 5 is generally the Newhall Ave. corridor including Lantana Hills / The Vistas
  • Canyon Country 1 is WEST Canyon Country (West of Sierra Hwy)
  • Canyon Country 2 is EAST Canyon Country (East of Sierra Hwy))
  • Canyon Country 3 is Fair Oaks Ranch south of the 14.

The Top 20 Priciest Areas in the SCV - 2018

Sand Canyon in Canyon Country remains the priciest.

The Top 20 Least Expensive Areas in the SCV - 2018

The Vistas, at the top of Valle De Oro in Newhall is a huge condominium complex that offers the lowest overall median prices.

What's ahead for the Santa Clarita real estate market in 2019?

Prices will rise at most.... 2%. Some neighborhoods will start to see FOR SALE signs sitting in front yards for quite a bit longer than they used to. Other neighborhoods may see slight declines in prices from January 2017. MOST neighborhoods will see pricing stay near levels they are selling for now.

What WON'T stay the same, are interest rates. Despite warnings from President Trump that raising the Federal Funds rate could seriously dampen the housing recovery, they raised rates Dec. 18th and plan to do so at least twice more next year. While mortgage rates don't go hand in hand with Federal Funds rates, they do get impacted.

Developments:

  • Newhall Land is literally moving mountains to build out the first of the Newhall Ranch villages.
  • Old Town Newhall will be selling condos situated above the new Laemmle Theatre by mid 2019.
  • Actual drawn up details for Porta Bella exist. Porta Bella will be the business ditrict and residential community in the hills east of Railroad Ave. and Bouquet Canyon off Golden Valley Road.
  • Vista Canyon in Canyon Country has an actual tract map now showing the layout.
  • Centennial at Tejon Ranch received the go-ahead from officials to start building the 19,000 home city. A 12,000 home companion development further north has been halted by a Kern County judge.

Finally... The LAST STATISTIC! Change in home sales by price point

Homes in the $400-$500k price range the hardest to find. Big Drop-off in sales.

In late 2018, where interest rates have pushed many out of the market, and prices have risen for 6 straight years, and are finally beginning to flatten and in some places recede, remember:

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