Sunset over the Pacific Ocean_ in Long Beach_ California.

The economy had solid growth in the first quarter with consumers feeling more confident about their financial well-being than last year. Their resilience in spending, however, is keeping inflation from falling and could create a real problem for the Fed in bringing down interest rates in the near term. Other macroeconomic indicators such as household purchasing power, on the other hand, suggest that the economy should start pulling back in the near future. As of now, the central bank is still projected to cut rates by 75 bps this year and the first rate-cut is expected to be in June. If the prediction turns out to be true, rates should begin a more sustainable declining trend in May, which should help improve the housing market in the spring home buying season. 

 

Consumer confidence holds steady but short-term outlook slips: Consumer assessment of the economy and their financial well-being was virtually unchanged in March, as the Conference Board reported a slip of its Consumer Confidence Index by 0.1 points from a downwardly revised 104.8 recorded in February. Consumers, in general, felt more positive about their current situation, but also became more concerned about their future outlook. The Present Situation Index increased 3.4 points month-over-month to 151.0 in March, but the Expectation Index fell 2.5 points from the prior month to 73.8. Lower expectations for the labor market conditions and the consumers’ assessment of their income prospect were contributing factors to the increase in pessimism in the consumers’ short-term outlook. With interest rates likely to fluctuate throughout the month of April, consumers’ short-term expectations could remain unsettled in the upcoming month. 

 

Consumer spending surges by the most since January 2023: After pulling back on spending at the start of the year, consumers began to splurge again in February despite borrowing costs remaining elevated. Consumer spending, or personal consumption expenditure, jumped 0.8% month-over-month in February after registering a more moderate 0.2% in January. The runup in overall spending was primarily due to a surge of 0.6% in the service sector, the biggest increase since the summer of 2021. If consumers continue to spend freely in the service sector, service prices may not ease back in the short term and could post a real problem for the Fed in making their decision on cutting rates. 

 

New home sales eased in February: New home sales in the U.S. came in softer than expected in February, with the number of newly constructed single-family houses sold dipping 0.3% month-over-month but gaining 5.9% year-over-year. The uptick in mortgage rates in February and a bounce back in inventory in the resale market might have curtailed sales in the new housing market in the latest report. Prices for new homes also came down in February with the median price dropping 7.6% from the year-ago level to $400,500 and reached the lowest level since June 2021. Declines in new home prices could be attributed to multiple factors. Builders’ willingness to reduce prices as construction costs dipped and developers releasing more smaller and affordable units in recent months are two main reasons that may offer some explanations. New housing inventory continued to rise and reached the highest level since November 2022, with new housing units climbing to 462,000 in February, an increase of 5.9% from the same time last year. The February inventory level is equivalent to a supply of 8.4 months and remains well above the historical average of 5.9 months. 

 

Residential construction spending continues to rise in February: Higher interest rates might have weighed on overall construction spending, but residential construction spending remained on an upward trend in February. Total construction spending in the second month of the year dropped 0.3% from the prior month, primarily due to nonresidential spending falling 1.0% as private and public categories weakened. Single-family outlays, on the other hand, increased again for the third straight month, with spending for single-family units rising 1.4% month-over-month and 17.2% year-over-year. Multifamily spending dipped from the prior month by 0.2% as vacancy rate continued to climb and rent growth softened further. With new home sales expected to pick back up as the market enters the spring home buying season, residential spending – particularly single-family outlays – should inch up further in coming months. 

 

Mortgage delinquency rate remains flat from last year: Mortgage delinquency at the national level was unchanged and remained near an all-time low in January, according to the latest Loan Performance Insights released by CoreLogic. Mortgage borrowers who were late in making their payments by 30 days or more accounted for 2.8% of all outstanding mortgages in the first month of the year, flat from the same level recorded 12 months ago. Twelve states reported year-over-year increases in overall delinquency rates, while 19 states’ rates remained unchanged from a year ago. A strong job market, moderate increases in home prices, and fewer homebuyers overleveraging in recent years when purchasing their properties are reasons that kept delinquency rates from rising high in the past couple of years. With home prices projected to increase in 2024 and the economy not likely to enter a recession this year, mortgage delinquencies should remain steady in the next 12 months.

 

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.

 

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For Sale

700 E Ocean Blvd #607

Long Beach 90802

1 Bed | 1.5 Bath | 880 SF | $625,000

 

Amazing ocean views in this beautifully remodeled open floor plan condo at the iconic International Tower! This beautifully updated modern high-rise condo features hardwood flooring, fresh interior paint, scraped ceilings, and is light and bright with expansive ocean views.  OPEN HOUSE

Saturday & Sunday

12:00 - 3:00 pm

6544 Cerritos Ave.

Long Beach 90805

2 Bed | 1 Bath | 1,198 SF | $699,000

 

Welcome to 6544 Cerritos Ave, a charming slice of Spanish-inspired architecture nestled in the heart of North Long Beach. This classic 2-bedroom, 1-bathroom home boasts timeless elegance coupled with modern upgrades, offering comfort and style.

837 Chestnut Ave. #12

Long Beach 90813

1 Bed | 1 Bath | 611 SF | $320,000

 

Step into this wonderful top-floor unit boasting an open floor plan in a mid-century style building. This property presents a unique opportunity to own a fantastic rental or a charming coastal condo just moments away from the beach.

In Escrow

1985 San Francisco Ave.

Long Beach 90806

3 Bed | 2 Bath | 1,509 SF | $1,020,000

 

This historic gem awaits you in the charming Wrigley neighborhood of Long Beach! This gorgeous Spanish home, built in 1928, is full of charming curb appeal with its gated courtyard, porte cochere, red-tiled roof and front steps leading to the turret entry!

Recently Sold

16136 Cornuta Ave. #117

Bellflower 90706

3 Bed | 2.5 Bath | 1336 SF | $590,000

 

Beautifully remodeled townhome with newly updated kitchen, baths, flooring, lighting, etc. Private 2 car attached garage.

14715 Bellflower Blvd.

Bellflower 90706

2 Bed | 1 Bath | 805 SF | $655,000

 

Welcome to your ideal starter home located in the heart of Bellflower! With its proximity to local amenities and welcoming neighborhood, this home is a must-see on your home-buying journey.

8738 Belmont St.

Bellflower 90706

3 Bed | 2 Bath | 1,276 SF | $720,000

 

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. 

8230 Santa InezBuena Park 90602

4 Bed | 2 Bath | 1,194 SF | $625,000

 

Beautifully remodeled end unit townhouse in Buena Park! 4 bedrooms, 2 baths with open floor plan, modern kitchen, and private backyard.

3825 Linden Ave. 

Long Beach 90807

3 Bed | 2 Bath | 2,142 SF | $1,350,000

 

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. 

2512 W Beachy Pl 

Anaheim 92804

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.

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.

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Tim Majka

(562) 900-9430

www.ImagineRealty.com

 

DRE #01399855