Real Estate News, Tips & Market Trends

You’ll find our blog to be a wealth of information, covering everything from local market statistics and home values to community happenings. That’s because we care about the community and want to help you find your place in it. Please reach out if you have any questions at all. We’d love to talk with you!

Nov. 4, 2021

Final Call for 2021

It’s officially November!  Can you believe that? I can’t believe that Thanksgiving is only a few weeks away and we only have 2 months left to the year!  With society exiting from the pandemic, we are starting to see the return of a normal real estate cycle.       

Every year as we enter November,  people started to shift their focus towards the holiday shopping and gathering,  We are now in the Holiday Market…the slowest time for real estate in terms of supply and demand.  There are just simply too many distractions.   As a result,  the overall speed of the market cools slightly and the marketing time increases a little bit.  

This is the time many sellers decide to hold off the selling until next year.  We have started to see a slight dip in the number of homes on the market for sale.  It went from 11,934 homes for sale in July in Los Angeles county to 11,407 homes for sale in October.  We are seeing a similar drop in Orange County as well… went from 3,818 in July to 3,338 in October.    

This number is expected to decline further. 


With so limited homes for sale and few options for buyers to select from,  many also put their home shopping desire on hold to enjoy the holiday, and that's one of the reasons we are seeing a drop in demand.  As matter of fact, we are seeing a larger drop in demand.    

The number of pending sales went from 6,779 in August in Los Angeles County to 4,019 in October and 3,092 to 1,484 in Orange County.  That's a 40-50% drop!


One of the reasons we talked about is due to the seasonal cycle.  Buyers simply put their plan on hold.  Another reason is due to affordability.  Price has simply gone up too much too fast.  The income is not catching up to the speed of housing prices appreciate.    

Median sales price in Los Angeles County went from $721,000 in January of 2021 to $810,000 in just 10 months and Orange County went from $787,000 to $915,000 in the same time span. 
   

    
So what now?  What we are seeing on the market is that good homes are still selling quickly and getting multiple offers and bidding war.  Homes that are less desirable and in a certain area are not selling as well as buyers are being more cautious with their money.    

It wasn’t too long ago that we saw any homes, good or bad, would sell.  Things definitely looked different!

 

Posted in Market Updates
Sept. 21, 2021

Seasonal Calmness or calm before the Storm?

Schools are back in session and more importantly in person.  Pumpkin Spice Latte  have returned.  Leaves are turning yellow.  Autumn has arrived.    

For the housing market,  the Autumn market generally begins the end of August when kids went back to School and it ends a week before Thanksgiving.  It is the time where the real estate market cools down from the “hot” summer/spring season. We would see a slight drop in supply (numbers of listings for sale) and demand (Number of pending sales) and marketing time remain about the same.  Despite the crazy market we had seen in the last 6-9 months.  We are seeing these trends just as we had in the years past.    

Demand drops because kids are starting school and moving during the school year tends to be very disruptive and a lot of families with school age kids put their home search on hold until spring.   

Similarly homeowners face the same situation and often time decide to put the selling of their home until spring when the school is approaching an end.    


In September,  on average,  there are about 12% less home for sale compare to the peak of the market in June.  Number of listings will continue to drop through winter and until springtime.  Since number of buyers also drops about 12%,  the market will feel pretty much unchanged.  

dSeller can expect fewer showings and fewer offers due to smaller number of buyer in the marketplace.  Homes that were getting 50 showings during spring may see 25 showings now , 5 offers compare to 10.  The advantage for sellers are still there but just not as strong compare to the spring market.  Homes will still sell fast and if priced correctly,  go above asking price.     

Buyers will see less competitions because many decided to wait until spring, but inventory shortage remains a problem.  There are still more buyers than sellers in the market.  

Yes,  the market is slowing/calming down.  We have less buyers AND sellers in the market.  Overall there are still more buyers than sellers.  We will still see multiple offers.  Sellers will still have more advantages.  The hottest sellers market may be behind us.  Nobody needs to freak out!  The market is not crashing.  It’s just a seasonal change!     

If you want to find out the value of your home,  you can simply give me or call pr access our free valuation too by clicking here

Posted in Market Updates
Sept. 15, 2021

Why is the Housing Inventory so Low? A Generational Wealth and Human Psychology Point of view

If you have been following my blog or channel, a lack of inventory has been the theme for years even before COVID.  Now, why is that?       

There are a lot of reasons but many of them are caused by fundamental change in behaviors and are not easily reverted.  In today’s video,  we will look at 4 fundamental or structure shift that stops housing inventory from coming to the market.          

1.  The Great RecessionMany people were affected or know someone that has been affected by the crash of 2008.  Homeowners watched their housing value plummet and equity vanishing.  Many lost their home to foreclosure or short sale.  As a result, a new trend emerged to avoid that burn caused by the lack of equity……people are staying in their home a lot longer.  Based on 2020 closed sales,  the turnover rate for LA and OC housing market is once every 25-28 years.  A lot longer than the traditional 7-10 years.     

2. Historic Interest RateAlso a result of the 2008 crash,  the inventory has been historically low.  Many homeowners who refinanced into a low interest rate decided to turn their home into a forever home or a forever rental.     

3. Generational ShiftThe advancement in science and medicine,  people are living longer and healthier.  The average life expectance of Americans is now 78 years old.  There are about 76.4 million baby boomers who have been the largest generation population group just until recently.  Millennials recently surpassed them.  They still do hold a majority of the assets in the United States.  It is estimated by the federal reserve bank that American age 70 and above holds a net worth of 35 trillion dollars - a bit portion of that includes real estate holdings.        

4. Builders Not building enoughNot only were everyday homeowners got burnt during the crash.  Many builders were as well.  Instead of keeps buying and selling simultaneously.  Builders have been release homes at a much slower pace.  When a homeowner move to a new build,  they have to put their old home on the market as resale.  So often time each new build can equates to 2 new listings instead of just 1.     

As you can see from that list.  most of these reasons that caused a shortage of inventory cannot be reverted or it will take a long time to change.  The governments are seeing this and that it why we are seeing a lot of rezoning or zoning variances to allow building of ADUs to allow more supplies…..to control the rent price…to control the housing price.    

So here is my take on the inventory problem.  Do you agree with my takes?  What do you think is causing the lack of inventory?  Share you thought in the comments below or email me.  

I look forward to talk to you soon.

Posted in Videos
Aug. 30, 2021

Top 3 Smart Features to boost your home Value’s

According to a study at Realtor.com. buyers pay around 5% more for houses with internet connected technology…or you can call them… smart homes.  Consider adding these desirable products to your home for self enjoyments and boost some value when you are ready to sell!    


Smart Doorbells - Safety and Peace of Mind 

63% of the homes sold were with smart features that included a security system.  Having peace of mind at home is on the top of most people’s wish list.  So it is apparent that buyers are willing to pay a little bit more for internet connected doorbells, security cameras, and alarms.   

As for anything,  you can hire a professional to install a whole house system with a monitoring fee and that option can get expensive.      

Many companies offer do-it-yourself security features that are less costly.  The popular ring doorbells, for example, can be found for about $170 and are easy to install. Same goes for multi camera exterior monitoring systems.    

Reminder:  Keep the manufacturers consistent.  If you are using a ring doorbell, it will be best to add security cameras that are in the same ecosystems. 


     

Smart Door Lock/Garage Opener - No More forgotten Keys

Ever got into the dilemma where you forgot if you closed the garage door or locked the front door and you are not sure if you should go back to check?      

Worry no more,  now with a touch of a button on your smartphone,  you can close/lock the doors with ease.  Having smart door locks also allow residents of a home to enter the home with a code or on an app - eliminating the need for a house key.  You can even set up different codes for a different person - parents, in-laws,  friends, or housekeepers.  You can also track who has used the code to enter your home.      

Reminder:  These are still electronic gadgets, and most smart door lock are battery operated.  Make sure you change the battery often or have a spare key somewhere accessible.     




Smart Thermostats - Save Money and be more energy efficient  

It is estimated that a wi-fi enabled thermostat such as Google Nest or Ecobee Smart can save homeowners 10-12% on heating costs and around 15% on cooling costs each month.  With price tags between $200-$300,  smart thermostats pay for themselves within a few years.    

These gadgets use a programmed algorithm to “learn” your temperature preferences and automatically adjust your home temperature, reducing energy consumptions.  You can also easily adjust the temperature setting on your couch with your smart home or a voice enabled devices such as Amazon’s Alexa or Google Home.    

As we advancing in technologies,  there are more and more smart home devices that come to the market and make our life easier.  All their features are convenient but home security and energy-saving features are always on top of most people’s lists. 



  

 

Posted in Featured Property
Aug. 26, 2021

1.7 Million homes in forbearance. Is a wave of foreclosure coming?

1.7 million homeowners are in a forbearance program due to the pandemic.  Are those forbearance going to turn into foreclosures?  Is a wave of foreclosure coming? Let's find out in today's episode of Real Estate Made Simple!  

As our life starting to get back to normal and the real estate market being as hot as it was in the last couple of months.  There is a fear among the general public that the national forbearance program ending will lead to a wave of foreclosures and cause chaos in today's hot real estate market.   

For those that are not familiar with forbearance..... it allowed borrowers to pause their payments.  Repayment of the missed payments can be done all at once, with a payment plan, or often time deferred to the end of the term of the loan.    

A lot of people seems to jump to the conclusion that 2008 is going to happen again and the housing market is going to collapse.  Not so fast!  And here is why...  

In August of 2008, 9.2% of all US mortgages were either delinquent or in foreclosure.  By September,  it went up to 14.4%.
    

Today,  only 3,4% of all mortgages are in forbearance which amounts to 1.7 million home owners.  Most of them will actually exit and not become a foreclosure or short sale just like the 5.2 million people that had already exited forbearance.    

At the peak of the pandemic,  a total of 7.2 million homeowners have taken advantage of the forbearance program according the Black Knight, a data research company.  Over 5.2 million have exited as of mid June.    

Yes,  there are still 1.7 million people in forbearance but thanks to the sizzling hot housing market,  most of these homeowners have plenty of equity to sell their homes.  87% have at least 10% equity and can sell their home and walk away with some money.  They remaining 13% will work out some sort of loan modification with the lenders.  Lenders had learned their lesson from the great recession NOT to foreclose on people too quickly.       

Let's look at the worst-case scenarios,  assuming the 13% which total to 221,000 homeowners were to go into foreclosure along with the 195,000 that are already delinquent,  we are talking about 416,000 foreclosures nationwide.  That number pales when compared to the near 9 million households that lost their home to foreclosures during the crash of 2008.      

We are not even considering the fact that there were 4 times  more homes for sale at the beginning of the crash compare to the inventory today.     

Based on all these numbers,  it is my opinion and I firmly believe that there will be no wave of foreclosures due to forbearance.    

The sky is not falling!    

I hope you enjoy today's video.  If you know anyone that may find this information helpful,  please subscribe to my youtube channel or like my Facebook page.  Look forward to talk to you soon!

Posted in Videos
July 28, 2021

In search of the missing sellers... why is the housing inventory still low?

Home prices are at its all time high,  we did see an increase in housing inventory or available homes for sale, but there was no surge.  You'd think more people would want to take advantage of the home prices right?  Why is that?  

Has there ever been a time....when you were a child and you touched a hot kettle or pot and got burnt?  You probably were always careful around hot kettle ever since right?   

Many homeowner were in the same situation after the great recession in 2008.  

Homeowners saw their equity vanished in a blink and many people ended up in foreclosure or short sale.  A lot of people were burnt or knew somebody that was.  As a result,  a new trend emerged... homeowners are remaining in their home a lot longer than before.  They are content in keeping their home and fewer homeowners opt to sell every year.       

Statistic had shown that from 2000 to 2008,  there were about 2,757 more homes that came on the market every single month compare to the the last 10 years.  That's an extra 33,079 sellers every year in the past.  And this is not just a phenomenon we see in Los Angeles area.  Its a trend we are seeing in the entire nation.  People are staying in their house longer.      

This is the reason that even pre-COVID-19, we were seeing historic lows on housing inventory.  The pandemic simply made it worse.    

Based on the 2020 closed sales,  the turnover rate in the LA and Orange county is about 28 years and 24 years in Orange County.  It has been between 23 to 28 years in the past decade. 


Why is this happening?   

1. Many people were turning their home into "forever home". 

2. Many homeowners have refinanced their mortgage interest rate as low as mid twos, which makes moving a lot harder.

3. Builder got burnt in 2008 and did not start building until 2014 and there are a lot less new homes available on the market.  New build usually trigger people desire to move and create resale housing inventory.
   

4. 
Baby boomers plan on staying put instead of downsizing after retirement due to the high housing prices and longer lifespan and activity level.    

Again, that is why we are only sitting on 1.5 months of housing inventory.  Those are the reasons why inventory is increasing slowly despite buyers experiencing sticker shock.  

This is another reason why the market won't crash.

Posted in Market Updates
June 17, 2021

Creating the illusion of a bigger yard

Did we ever treasure and value our own backyard as much as we did in 2020?!  COVID-19 pandemic definitely changed the way people behave and live with all these outdoor/public restrictions and mask mandates.  We were in our house more. Without the outdoor venue closed or restricted, more people enjoyed their own backyard.  At the same time,  not everyone has a spacious yard.  Here are a few tips that will make your yard look bigger!    

Creating a focal point       

When you direct people's attention to a focal point,  people tend to realize the size of the yard less.  It can easily be accomplished by arranging bright colors such as orange, red, and yellow near the entry.  They catch people's attention while pink, blue and purple do the opposite and should be placed near the outer edge of the yard.     

Use the right size plants and planters      

Unlike indoor decorating,  plants with bigger leaves actually can make space look bigger.  Plant them strategically near the entryway to allow them to create more layers visually.  Plant the smaller leaved plants near the outer edge of the yard as they don't block as much lights.    

Use the vertical spaces      

Arbors, pergolas, and trellises support plants and provide shades and they can also be an anchor or focal point for the outdoor space.  They also can keep your groundless crowded.   

Create Separation   

Separation of create an illusion of space.  Dedicated an areas for dining that contains all the fixture of a living space.  Have another area for grills, tables, lounges, and chairs.  This will make the yard look more functional and visually more spacious.     

Use of different material    

Similar to create separation,  consider using different surfaces such as turf, gravel, or paver to define different areas.  For better results,  place them at different heights to create an illusion of a bigger yard.      

Implement diagonal shapes     

In the case of a makeover,  design walkways and decks to using diagonal shapes.  Straight lines span the shortest distance from point A to point B.  If space permits,  allow walkway to curve.  Make them narrow or decrease their width to create that depth of field look.

 

Posted in Seller Tips
June 2, 2021

Will Real Estate Market Heat Up Again?

Housing market has been sizzling hot for the past 12 month with price in Los Angeles and Orange County up more than 20%. Spring and summer are usually the hottest time to buy or sale real estate with kids out of school, tax returned filed, and longer day light to look at houses. We usually will see number of homes for sale (Sellers on the market) increasing from March through July/August. Pending Sales (Buyers on the market) usually peaks in March and maintained steady before declining in August.     

Post Covid.....are those trends still the same?      

Apparently Not! Well...at least half of it. The number active listings increased from March to April which is on par with historic trends. I am expecting to see more inventory coming to the market in the next couple of months. Where are they coming from?       

1. Regular seasonal trend - As mentioned earlier,  inventory tends to increase from March through August.        

2. Life Back to Normal - Many home owners wanted to sell but were scared to last year due to the pandemic.  Now that we are opening back up on June 15,  more sellers will be comfortable putting their home on the market.      

3. Suppressed Eviction Inventory - With the Eviction moratorium ending on June 30, the court will be able to start process eviction filings.  That will bring relief for many casual investors.  Many of them will decide that it is time for them to cash out.      

4. Historic High in Price - with the price sitting at an all time high.  Many home owners that are profit driven will be tempted to cash out on their investment. 

So inventory has been increasing and will continue to increase.  How is the demand doing?   

As of the writing on 6/1/2021,  there were 4,774 homes pending (in escrow) between Los Angeles and Orange County in May - down from 9,417 from April and also down 26% compared to May of 2020.  Why is the pending sales down in a time where it should be going up -  the big A word.....affordability.        

With the price up more than 20%,  the savings people get from the historic interest rate were all absorbed by the increase in price. 


With the payment on a median sales price home essentially the same today as the rate was at 4.875%,  homes are all of sudden expensive again. A lot of buyers are starting to back off from the market thus demand drops.       

For the market to improve and price to continue to grow,  demand has to grow.  What will drive the demand up?  Affordability has to go up.  Here are a few ways for affordability to go up...      

1. Household income increase -  with income increasing,  buyers can sustain a higher monthly payment on their mortgage.      

2. Interest rate drop -  When the interest rate dropping, the monthly payment will decrease making homes more affordable.     

3. Home Prices decline -  with home prices dropping,  obviously homes become more affordable.      

Do you see the household income increasing or the interest rate dropping?  It's hard for me to see that.  

So the only way for affordability to go up and drive up the demand is for the price to softens and come down.        

Moving forward,  I am expecting the inventory to increase and it's hard for me to see any reason for demand to go up significantly.  We can logically expect the market to continue to soften.     

What does this mean for a Seller? If you are on the fence about selling,  you still got time to take advantage of this last stretch of this historically best seller's market before prices move.      

What does this mean for a buyer?  If you are actively looking for properties,  you may not need to be as aggressive on your offers moving forward especially on a less desirable property.  If you are a cash buyer or you don't have to buy now,  definitely monitor the rate and the price.

Posted in Market Updates
May 14, 2021

Tips on Creating a Showroom Like Closet

Tips on Creating a Showroom Like Closet

Closet spaces is always high on a buyers like and something definitely adds value.  Often time closets look like a storage than a retail showroom.    A few simple tweak can put your closed to better utilization and presentation!  

Declutter before you organize

You can't really have room to organize unless you have rooms to organize.  Go through the items and figure out when was the last time you use/wore them and decide to keep them, donate them, or simply throw them away.  

Find your Good Will Donation Center Here

Keep your Favorites in front

Rather than all shirts together, all pants together, etc,  think in terms of outfits and favorites.  Keeping your most loved/worn clothing in front makes it easier to dress

Maximize horizontal and vertical space

Use slim hangers and store unused hangers elsewhere.  Create two levels of closets rods for pants, shirts, skirts, and blouses.  A stool can add 8 inches t your reach so you can put clothes you don't wear often on to.  

You can always find some good ideas on sites like Wayfair, Home Depot, or Lowes

Skip the closet altogether

Sotre shoes and off season clothing in little usesd spaces in your home - under the bed or in the garage using low profile plastic Containers.  If you want to get creative,  bring pretty baskets and trunks that add visual appeal and hidden functionality. 

Corral odds and ends

Jewelry, belt, scarves and ties all take up coveted spaces in drawers and closets.  Use specially designed hangers for belts and ties, dedicate a drawer for rolled up items or be the artist and displace these items out in the open.  

Don't Neglect the top shelf

People tend to tuck things on the top shelf thinking they will need them someday.  Organize your top shelves once a year and let go of items you no longer need 

 

Posted in Seller Tips
May 10, 2021

Breaking! Price up 20% but is a shift in the market coming?

Real Estate has been sizzling hot there is no doubt about it. Price has risen by over 20% in the last 12 months. That's 5 years' worth of appreciation in one single year! 

So where will the market go from here? Is it reasonable to expect the market to continue to go up? or 
what goes up will eventually come down? Find out in this episode of Real Estate Made Simple!        

Hello again! This is Jack Ma w/ Jack Ma Real Estate Group at Century 21. Thank you for watching 
this video. Before I start, I want to remind you that if you like this video, please click the subscribe button on youtube or like button on Facebook to get the most up-to-date Real Estate information and tips.     

You know I am always big on understanding the supply and demand to know where the real estate 
market is because they are precursors to price change.    

I want to dive in on some live charts with you guys today....    

Let's first look at the Supply chart for LA and Orange County......    

We can see that the # of homes for sale on the market has been dropping rapidly since May of last 
year. That trend reverted in march where we saw a valley happening between February and March and started to noticeably increase in April.    

There are 3 major reasons causing the inventory to climb: 
 

1. Seasonal Spring/Summer Sellers
2. Investors taking advantage of the historic high prices       
3. Sellers feeling more comfortable as we head into post COVID   

How does the buyer demand compare?    

We also saw the steepest drop in pending sales in over a year between March and April. We went 
from almost 10,000 escrows opened in march to less than 6000 escrows opened in April. Huge Drop!    

It is atypical to see this in a spring market with inventory increasing. This is a strong indication that 
the buyers are beginning to get turned off by the rapid increasing prices and are not biting on properties that are clearly overpriced.      

While it may be still too early to tell if this trend will evolve further but we may have seen the peak in 
buyer activities in March already.    

While the supply and demand curves are showing signs of cooling off, it is still a very hot seller's 
market where there are a ton of showings. Sellers still get to call the shorts during the negotiation process, multiple offers are still the norm, and prices start rising rapidly. 

Posted in Market Updates