With an extremely limited supply, this is the hottest November since 2012.
Hot November Housing
With an Expected Market Time of 41 days, in the midst of November, the Southern California RCFE market is hotter than the Spring Markets of 2014 through 2019.
This is the year when everyone is looking forward to the holidays. From the annual pilgrimage to the attic to take down the holiday decorations to preparing the extensive menu for the Thanksgiving feast, everyone cannot wait to enjoy a bit of a break from 2020. The festive season is at the doorstep with cooler nights, sunsets before 5 PM, and holiday tunes on KOST 103.5. It is time to slowdown and relax. Yet, that will not be the case for the Southern California RCFE housing market.
Just because everyone is sipping their favorite Starbucks latte from their recently unveiled holiday cups, does not mean that housing will slow this year. In fact, if an RCFE home is priced according to its Fair Market Value and is in great condition, it will procure multiple offers, a bidding war will ensue, and it will often sell for more than the asking price. RCFE values are on the rise. The difference this year is that there is an ultra-low supply of available properties to purchase and RCFEs are flying into escrow nearly as fast as they are coming on the market. It is sizzling hot in the middle of November and the start of the Holiday Market, now through the first few weeks of January.
The Expected Market Time (the time between listing to opening escrow) is currently at 41 days, a Hot Seller’s Market. The Expected Market time is the overall speed of the market, the lower the number, the faster RCFE homes are being placed into escrow. Anything below 60-days is considered a Hot Seller’s Market. That is a market with a tremendous number of showings, multiple offers, sellers get to call the shots, and RCFE home values are on the rise.
To put the current market in perspective, the Expected Market Time last year was at 71 days, a Slight Seller’s Market (between 60 and 90 days). That is a market where there are fewer multiple offers, sellers still get to call more of the shots, but home values are not changing much at all. At today’s 41-day level, the market has not been this hot in November right before Thanksgiving since 2012, the beginning of the housing recovery. When housing is this hot, this late in the year, it sets the stage for a very strong beginning to the New Year. That is precisely what occurred in January 2013. That was the only year since tracking began in 2004 when it was a Hot Seller’s Market from January 1st through July. The Expected Market Time in January 2013 was at 47 days. In January of this year, the Expected Market Time was at 82 days, a Slight Seller’s Market.
The start of 2021 will be like 2013; it will be a Hot Seller’s Market upon ringing in the New Year. It will be ushered in with a record low number of available RCFE homes to purchase, beating the lows established in 2013. The depleted supply will be met with a rush of demand stimulated by a record low interest rate environment. A low supply and hot demand bode well for sellers. That is the story right now, and it will be the story in 2021.
A WARNING to Buyers: The market is hot now and will remain hot through the spring of 2021. Do not expect the market to slow just because of all the diversions of the holidays. Right now is still an unbelievable opportunity for RCFE buyers to cash in on the record low mortgage rate environment. There is plenty of buyer competition and it is not going anywhere.
A WARNING to Sellers: Carefully pricing an RCFE home based upon its condition, upgrades, and location is still fundamental to find success. Overpricing an RCFE will not only result in a waste of market time, but it will also prevent a seller from taking advantage of the bidding war that ensues when priced according to its Fair Market Value. As a result, overpriced sellers often net less at the closing table.
If we may assist you with the purchase, sale or lease of an RCFE, please feel free to contact us anytime. It would be our pleasure to formulate a comprehensive plan for your success and a detailed strategy to help you achieve your objectives. We have assisted many buyers and sellers of RCFEs and would be delighted to share our expertise with you. If you would simply like to explore your options, we offer a complimentary consultation. Call TODAY to schedule your free session.
We look forward to helping you!
If we can be of assistance with your purchase, sale or lease of an RCFE or other property please call us today for your FREE Consultation:
Michelle (949) 397- 4506 & Melvyn (949) 500-3630