In many ways, the Beverly Hills housing market is like a living and breathing organism. The local housing market is constantly changing and developing, and unless you study the market on a daily basis, you may feel like you’re never able to keep up. In this article, you’ll get a better idea of where things currently stand and how the market landscape might change over the next twelve months.
You’ll find answers to many of your most pressing questions about the current and future state of the market as you continue reading.
What’s the local market doing right now?
Home prices in Beverly Hills are soaring, but they still aren’t as high as they were in 2020 or 2021. Most homes spend between one and two months on the market before going under contract for a price slightly below the listing. If a home is in especially high demand, it can sell for an amount closer to the seller’s original asking price. Multiple offers are rare, but so are price drops.
How does this compare to the state of the national market?
Most housing markets across the nation are struggling to keep up with rising interest rates and rampant inflation. A growing cost of living makes it difficult for many prospective buyers to think about buying a new home. Things are quite different today than they were nearly three years ago when interest rates were low, and many buyers were shopping for new homes.
Sellers would often find that they could list their homes for higher-than-average prices while still fielding multiple offers above the asking price with waived contingencies. Now that interest rates are high, demand is much slower, and prices are coming down as a result.
What sets the Beverly Hills market apart from other markets across the nation?
Beverly Hills is a popular area for many people who are shopping for luxury homes. These buyers are often less susceptible to changes in the economy and the housing market because of their affluence. They don’t have to worry as much about rising costs of living or higher interest rates because of their reserves and their cash flow. Qualified buyers should continue to emerge with interest in Beverly Hills property as long as the area remains desirable.
When could the national market begin to shift in a different direction?
Many people want to know when interest rates will come down or when home prices will begin rising again. It’s hard to say with any degree of certainty when this could happen. The Federal Reserve has suggested that interest rates could drop sometime during 2024, but inflation likely needs to get under control before such a change would make sense.
The good news is that rates always come down to past averages, even after prolonged seasons of being higher than normal. Interest rates were as high as 20% in the 1980s, but homes continued to sell, and rates eventually dropped.
Is the market headed into a recession?
Many people believe a slight recession is likely to happen sometime during 2023. Thankfully, most people don’t believe that the recession will be long-term or significant. The general theory is that the market is simply correcting itself after the rampant activity of 2020 and 2021. Home prices may dip slightly this year, but nobody expects that the market will crash like it did in 2008.
There are also reasons to believe that the market is still in a strong position. The mortgage delinquency rate hit an all-time low during the third quarter of 2022. This is a key statistic that many industry leaders believe tells a greater story about the overall health and condition of the market. A higher rate would suggest that the housing market was in greater trouble, so it’s encouraging to hear the news of lower rates.
How much does the market change throughout the year?
Typically home prices are highest during the late spring and early summer. Buyer activity is stronger during these months because of the return of tax refunds and the end of the school year. Prices stay high through July and August before dropping in September and October. It’s normal for prices to be lower during the winter because of the lack of demand among prospective buyers.
How will the current state of the market impact long-term property values?
It’s unlikely that the current state of the market has any impact on a home’s long-term value. Homes are hard assets, meaning that they have a real and tangible value that is easy to perceive. This sets homes apart from other investments, such as stocks that can see multiple price changes on a single day.
It’s also important to remember that home prices have outpaced inflation over the last 100 years by nearly three percent. This means that homes are truly growing in value despite the occurrence of significant economic challenges, such as the Great Depression of the 1930s and the housing market crash of 2008. The market continues to show a high degree of resiliency and should continue to do so as time goes on.
If I decide I want to shop for a home this year, who can help me?
Despite the current set of challenges, 2023 could still be a great year to buy or sell a home. If you still have questions about the state of the Beverly Hills real estate market or if you want to move forward with your sale or purchase, reach out to Matt Coffer and the Dellinger Coffer Group. They will be more than happy to assist you.
They take time daily to study where the market currently stands and use their insight and expertise to educate each of their clients about how to make the best possible decisions when buying and selling homes. They would be honored to help you determine how to move forward with your upcoming sale or purchase, and they will work tirelessly to help you reach your goals.
