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What is in store for the Greater Los Angeles Real Estate in 2014?

Posted on Dec 23, 2013 by in Active Rain | 0 comments

 

What is in store for the Greater Los Angeles Real Estate in 2014?

 

I have been asked by clients, potential seller as well as potential buyers as to what is in store for the Real Estate Market in the Greater Los Angeles area in 2014? This question is often asked concerning the Los Angeles Real Estate activity at parties and other functions I attend. Sometimes I receive the same question via email. Since I have been answering this question so often lately, I thought I would share with everyone via a Post. By the way, on a side note, this is a good thing when Real Estate Questions are the Topic of discussions at Social Activities such as Holiday Parties and Cocktail Parties. It is clearly a positive sign.

 

 Let’s be honest, we do not really know where the activity will head without a crystal ball, but there are clearly some solid  indicators that give us a pretty good idea where the Real Estate Activity will head to in 2014 and beyond.

 

First and foremost we need to monitor Consumer Confidence Index very closely. This usually will let us know what will be happening in the coming months. This is important, since from the time the average buyers decide to purchase a property generally you are looking at 90-120 days before they actually close on a property. The key is that it takes about three to four weeks to find and negotiate on a property and then thirty to sixty days to close.  So if the buyers move fast there is your 90 day benchmark and if there are delays along the way, then you are looking at 120 days. Hence we can have a good indication what will be like in the coming three months!

 

 The current consumer confidence has been measured by Government Agencies, Banking Institutions, internet platforms that have a large group of Realtors answering questions as well as potential buyers who are communicating their sentiments and large Real Estate Brokerages who monitor this very closely. The consensus is pretty much identical that the Consumer Confidence is improving.

 

Second we need to monitor the activities of large scale investors.  Since the majority of these investors do their homework and even have economic advisors who create prediction models as to how the Real Estate Market will perform in the short as well as in the long term. They are on top of this, since they have the most to gain or lose from a financial perspective.

 

  See for yourself as you drive around the Greater Los Angeles Area, there are large massive Condominium complexes which are being built as of this writing. Others have Notices on their Entrance points indicating, that the property is in the building department for updating or demolishing approval. Clearly this type of activity is a three to ten year project. Hence the answer is clear the big developers feel good not only about 2014 but for a few years past it.

 

Third we need to monitor the Affordability Index.  As prices increase and interest rates climb these factors will all slow the real estate activity in the various geographic markets.  Since Los Angeles has such a high average entry level price point this should generate minimal effects as far as slowing the Real Estate Market locally.  This in actuality will be a benefit since it will create a balanced market for all instead of being a Seller’s Market or a Buyer’s Market.

 

Fourth we also need to closely watch the reports which disclose the number New Home Construction Permit being initiated. These reports augmented by the unemployment figures will give good indication how the Real Estate Activity will continue for the next few months or even longer. Since it takes about four to six months to build a New Construction home and there is a reduction of new construction permits that will clearly indicate what the activity will be like in the upcoming four to six months.  Needless to say if employment figures do not improve and unemployment figures rise, that will have a detrimental effect on the Real Estate Market as well.

 

In conclusion: I must say that I am bullish on the 2014 Real Estate Market. Clearly there might be events occurring around globally that we might not be able to factor in as to what the cause and effects might be on the Real Estate Activity. Just as we have limited idea of the Affordable Health Care Act will have on the Economy and the Greater Los Angeles Real Estate Market. All things considered I anticipate a solid Real Estate activity in the Greater Los Angeles in the coming year.

 

So if you have a smart phone, a computer, a laptop, or a tablet you will be able to monitor all these activities through many portals such as the News Outlets, the business media outlets. Now if that is too cumbersome for you, then please subscribe to my blog and read my updates about the Greater Los Angeles Real Estate market.

 

From a  Beverly Hills Realtor’s perspective, the best advice I can give is not to focus on the headlines but ask for the actual local market activities that. The technology of instant headlines is great but ultimately it will come down to finding the best Realtor who can provide you with figures and honest interpretation of those statistics coupled with  good old fashioned client service!

 

 

 

If you are considering buying or selling a luxury home, an ultra luxury home, luxury investment real estate, luxury vacation homes, or luxury beach properties in Southern California, Los Angeles, Century City, Westwood, West Hollywood, Beverly Hills, Marina Del Rey, Venice or Malibu, feel free to contact me at 310.486.1002 or homes@endrebarath.com or visit one of my websites at http://www.endrebarath.com.   I am a pet friendly realtor and I contribute a portion of my commissions to local animal rescue organizations. –

 

 

 

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