Curbed LA reports that the average home in Southern California is going for a massive $600,000, which is back down from $615,000 after winter sales proved less successful. Statewide incomes are failing to keep up with these major housing prices, making homeownership unattainable and adding on to the unlikelihood of a sale.
The report goes on to say that the home price “drop-off” is misleading, having just crossed the threshold of an all-time high last summer. In fact, home prices in LA County are up $10,000 in just one month, with a 1.7 percent lift between March and April 2019. Even though there has been a 12 percent increase in purchases within that same timeframe, the report calls the overall number of sales “underwhelming.” LA Curbed cites that the actual total of homes sold year-over-year is down 15 percent.
Despite the seemingly quick potential for a huge payout, it’s a solid time to rent out your property and turn it into an investment. As mortgage interest rates soar and vacancy rates plummet across LA County, the renter’s market is absolutely saturated. With a great many Californians desperate for housing, especially with the looming threat of wildfires, it’s simply a matter of finding who is most qualified to live in your home. Your investment property will be overrun with applicants.
To be fair, it’s not a perfect renter’s market, either. A combination of natural disasters, a shortage of units, and an overall lack of affordability have led to statewide rent caps. The goal is to ensure that California’s lower-income citizens are not at risk of eviction or homelessness. Recent legislation has extended the rent caps to single-family units and attempts to prevent price gauging are becoming swift and harsh.
