By Mike Rains, Nov 29 2018 09:39PM
There are voices from many corners saying many things regarding what will happen in 2019 in the housing market. Time will tell who is correct, but then again hindsight is always twenty-twenty. In this article we will explore some of what can be expected. As an agent, I offer boots on the ground, "what it feels like" perspective, but since real estate is local, it is imperative to look at all sides.
The Remax Housing report came out this month for October's numbers and demonstrated, nationally, that for the third consecutive month of year over year lower home sales has now led to the first year over year inventory increase in ten years’ time. The RE/MAX National Housing Report for October saw sales decline 4.6% from a year ago – compared to sales drops of 11.6% in September and 1.1% in August – and was the eighth month of 2018 to record lower sales than 2017.
As a result, inventory is slowly being replenished, with the number of homes for sale in October increasing 1.0% over October 2017. October 2018 was the first month to show a year-over-year increase in inventory since October 2008 when two and a half times as many homes were for sale. The Month’s Supply of Inventory is now 3.5, compared to 3.3 a year ago.
“The market continues to move toward equilibrium. The modest inventory increase is a much welcome sign for buyers,” said RE/MAX CEO Adam Contos. “Although home sales were down year-over-year, it’s encouraging to see the magnitude of the decline decrease from the sharp drop we witnessed in September. The trend of easing price increases remains and that’s also a positive.”
California Association of REALTORS® Senior Vice President and Chief Economist, Leslie Appleton-Young, presented the 2019 Housing Forecast on November 27, 2018 to Orange County REALTORS® members. In this report for California forecasts the most likely case to be that homes sales of homes will decrease by a -6.9% with the average homes sale price to also decline by a -.2%. This is obviously the first time in a while that Californians have seen homes values decline, albeit it is a very small amount.
As a Realtor in Southern California, Orange County, I have personally seen that many agents like myself have seen a slowdown in sales numbers, and in many cases, it is due to lack of inventory from new sellers to the market, or a traffic jam of sorts from sellers who would like to sell their home and move, but have not had the confidence that they too would find a suitable replacement. The phenomenon at the very least has contributed to the lower inventory numbers. Also as agent, with fewer sales, and more agents in the marketplace, there has been less to go around. This will cause many agents in the near future to exit the real estate business.
What does all this mean? Well with interest rates due to continue a gradual rise, I believe that this represents a great time to be a buyer in the market place and not experience the frenzy and multiple offer situation. Sellers too can continue to reap a really great rise that has taken place and make the move that they have been wanting to make to other areas or upsize or downsize their current living space. There are contingencies that we as Realtors can put in place to protect both buyer and seller to give the time needed to find another home. It is a win-win for all sides. As usual I am available to talk with anyone considering making a move in or to the Orange County, CA. market. Call me anytime at (714) 293-4786. #askMikeRains #mikerainsrealtor