contemporary living room with open concept view through to dining room kitchen and a marble fireplace with gas fire

The housing market had a tough year in 2023 as tight supply and high costs of borrowing continued to have a negative impact on supply and demand. Easing inflationary pressure and a soft economic outlook, however, suggest that there will be some interest rate cuts on the horizon in 2024, which bode well for a housing market recovery. With rates declining to a 7-month low, Americans are feeling more positive about the market, and we could begin to see some increase in market activity. Meanwhile, home prices should maintain their upward momentum as tight supply remains the norm and the market will likely observe a mid-single-digit year-over-year growth rate in the statewide median price in at least the early part of 2024.

 

California home sales remain stagnant at the end of 2023: California home sales in December remained near the 16-year low reached in November and continued to drop year-over-year for the 30th straight month. For the year as a whole, 2023 recorded an annual sales level of 257,630, a decline of 24.8% from the revised sales level of 342,530 reported in 2022. The annual sales decline in 2023 was the biggest drop in existing home sales in California since 2007. With rates moderated sharply at the end of 2023, home sales should see a bounce back in January and February, but the improvement will be mild in the next couple of months.

 

Tight supply continues to be the norm but market could see more inventory this spring: Active listings at the state level declined on a year-over year basis for nine straight months, and the decline for the current month remained above 10%. New active listings at the state level also dipped from a year ago for the 18th consecutive month but the annual decline remained below three percent for the second month in a row. Twenty-four of the fifty-one counties tracked by C.A.R., in fact, increased in new active listings from December 2022. With mortgage rates remaining well below the cyclical peak reached last October, the market will hopefully see more for-sale properties being listed in the first quarter of 2024. 

 

Housing starts dip from November but builder sentiment boost hopes for spring: The U.S. Census Bureau reported a seasonally adjusted annual rate of 1.46 million units of housing starts in December, a drop of 4.3% from November but an increase of 7.6% from 1.36 million in December 2022. Single-family starts dipped 8.6% on a month-to-month basis but jumped 15.8% from 12 months ago. The monthly decline in December was attributed partly to a change in weather conditions, as an unseasonably warm November could have pulled some constructions forward. Building permits, on the other hand, inched up slightly by 1.9% from November and by 6.1% from 12 months ago. Builder sentiment continues to improve as lower mortgage rates motivate more potential homebuyers to return from the sidelines. The National Association of Home Builders’ Housing Market Index (HMI) increased seven points to 44 in January, reaching the highest level since September 2023. More permits and higher builder confidence level suggest that housing construction could rise again in coming months.     

 

Retail sales remained strong and exceeded expectations: Consumers spent more than expected in the final month of 2023, with December retail sales up 5.6% (not inflation adjusted) year-over-year. The latest retail sales report showed broad-based solid growth at the end of last year, with spending at Restaurants and Bars surging the most (11.1%) from the prior year, followed by Electronics and Appliances (10.7%) and Health and Personal care (10.7%). Many shoppers have used the “buy now, pay later” financing option during the holidays, with the payment plans racking up $16.6 billion in online spending during the holiday season. As such, there could be a pullback in consumer spending in the months ahead as bills come due for shoppers who borrowed forward at the end of last year.

 

Biggest 2-month surge in consumer sentiment in 30+ years: Consumer sentiment reported by the University of Michigan jumped to the highest level since 2021 as Americans began to feel more upbeat about the economy. The sentiment index climbed 9.1 percentage points to 78.8 and the surge was the biggest monthly increase since 2005. On a two-month basis, the index rose 29% cumulatively and posted the largest 2-month increase since 1991. Compared to the all-time low registered in June 2022, the reading in January 2024 was 60% higher. With inflation cooling and the labor market remaining solid, it is not a surprise that consumer sentiment began to pick up in recent months. Inflation expectation a year from now, in fact, declined to 2.9% in January from 3.1% in December, the lowest level since December 2020. The rapid improvement in consumer sentiment is a positive sign for the general economy but is also a signal that rates could remain higher for longer.

 

If you have any questions or would like personalized advice regarding the current market conditions, please feel free to reach out. Your success in real estate is my top priority.

 

Road in California

 

Looking To Move Out Of State? 

Save Thousands for Dollars With Our

Relocation Program

 

As a top agent with the #1 brokerage in North America, I have relationships with some of the top agents all over the country. I have recently helped some clients move to Tennessee, Arizona, Nevada, Montana, Texas, Florida, and other states with the help of my KW Relocation network of local experts to help them find their next dream home. My network of agents saved them thousands of dollars and reduced the time and hassle of finding a new home in another state.

 

If you or someone you know is looking to relocate to a new city or state, contact me to tap into the power of my network of experienced agents throughout North America. 

SEARCH HOMES FOR SALE

CONTACT ME

WHAT'S MY HOME WORTH?

For Sale

8738 Belmont St.

Bellflower 90706

3 Bed | 2 Bath | 1,276 SF | $699,000

 

An incredible opportunity awaits with this charming 3-bed, 2-bath single family home. Set on a spacious 7,004 sq ft lot, that beckons with endless possibilities for entertaining or even possibly adding an ADU. 

OPEN HOUSE

Sat (1/27) & Sun (1/28) 12 - 3pm

3825 Linden Ave. 

Long Beach 90807

3 Bed | 2 Bath | 2,142 SF | $1,250,000

 

Charming 1933 Spanish Stucco with many original features. This single story home is situated on one of the prettiest streets, walking distance to to both Atlantic Avenue and Long Beach Blvd. 

In Escrow

2512 W Beachy Pl Long Beach 90815

3 Bed | 2 Bath | 1,695 SF | $875,000

 

Embrace the charm of this lovingly maintained single-story home, cherished by the same family for over 50 years. Nestled on an expansive 10,948 sq ft lot, this property beckons with endless possibilities – from adding an ADU, a pool, more living space, or just simply reveling in the serene, park-like ambiance.

Recently Sold

2174 Stanbridge Ave

Long Beach 90815

3 Bed | 2 Bath | 1,489 SF | $905,000

 

Nestled in coveted Los Altos... known for being pet & people friendly with awesome schools, parks, walkability & more! This immaculate & inviting 3 bedroom/2 bath home with its upgraded kitchen, baths, living room as well as spacious family room will go fast!

807 Delaware St

Huntington Beach 92648

4 Bed | 5 Bath | 3,237 SF | $2,605,000

 

Tesoro Builders has created another extraordinary opportunity to own a brand new, custom designed single-family home in the heart of highly coveted downtown Huntington Beach. The epitome luxury living offers an exceptional beach lifestyle.

5417 Bonfair Ave

Lakewood 90712

4 Bed | 2 Bath | 1,746 SF | $950,000

 

Welcome to this recently updated 4 bedroom, 2 bath two story home located in the heart of Lakewood.

251 Elm Ave. 

Long Beach 90802

2 Bed+Den | 3.5 Bath | 1,750 SF | $915,000

 

This exceptional modern townhome at The Huxton built in 2018 boasts 2 bedrooms, a den/great room, and 4 baths spanning 1,750 square feet. The large rooftop deck off the top-floor den/great room provides an exceptional indoor/outdoor living experience.

2059 W 160th St.

Torrance 90504

2 Bed | 1 Bath | 837 SF | $780,000

 

Discover Your Dream Home in North Torrance! This charming 2-bedroom home is nestled on a serene residential street, offering you a remarkable opportunity to own in this sought-after neighborhood with great schools.

781 W 30th St

San Pedro 90731

3 Bed | 2 Bath | 2,067 SF | $1,225,000

 

Stunning 3-bed, 2-bath home with breathtaking ocean views in Coastal San Pedro. Experience the beauty of the ocean from the front yard, primary bedroom, and the expansive backyard.

773 W 30th St

San Pedro 90731

3 Bed | 2 Bath | 1,040 SF | $955,000

 

Enjoy beautiful ocean and harbor views from the front yard, living room, and the expansive backyard. This 3-bed, 2-bath home offers even more possibilities with an additional enclosed patio area currently staged as a family room and game room.

Facebook  Twitter  Instagram  Linkedin  Youtube  

SEARCH HOMES FOR SALE

CONTACT ME

WHAT'S MY HOME WORTH?

 

Tim Majka

(562) 900-9430

www.ImagineRealty.com

 

DRE #01399855