Hot Property Q&A: Buying and Selling in Southern California
As we move beyond the COVID-19 pandemic, one thing remains unchanged in our “new normal” – the Southern California real estate market is as hot as ever.With records being set daily in listing prices, market turnover and housing scarcity, prospective buyers and sellers often have no idea where to begin to either look or list.
In a market as kinetic as the housing sector, expertise is essential. Hot Property has opened the conversation about purchasing and listing to four Southern California real estate experts who have provided invaluable information that prospective home buyers or sellers need before taking any further steps; here is their advice.
Q: People often question if now is the right time to buy and/or sell – what do you tell them?
Jeff Hyland, President and Co-Founder, Hilton & Hyland: There’s no doubt that we’re currently in a seller’s market with record prices and low inventory. However, with mortgage rates at all-time lows, we’re seeing major demand from buyers as well to get into the market.
Jade Mills, International Ambassador, Coldwell Banker Realty: I always tell people who ask if this is a good time to buy or sell that even the best real estate agent cannot predict the future. Because the real estate market in Los Angeles over time has always gone up, now is a good time to buy.
Parker Beatty, Regional President, Compass: The combination of low interest rates and low inventory makes this an incredible seller’s market. The buy side of the equation is extremely competitive. However, the pandemic has caused people to re-evaluate their living situations and take fast action. Favorable financing continues to be the buyer’s best advantage.
Shen Schulz, Broker Associate, Shen Realty: It depends upon market conditions and the goals of the individual client.
Q: Are we in a bubble with prices at an all-time high? If so, do you believe we’ll see a future price correction?
Schulz: I would not call it a bubble; I would call it a supply and demand issue. Prices are at an all-time high in Malibu with a short supply for new listings. However, compared to the other coastal river areas, Malibu is more affordable than most.
Hyland: No one knows for certain what the future holds, but the housing market is on very solid ground right now.
Beatty: We anticipate strong demand that will last well into next year. Will there be a price correction? Real estate is cyclical, period. Having said that, California has rewarded property owners with extraordinary appreciation over the long term.
Mills: We may see a slight price correction, but the economy is very strong. My suggestion is to invest in residential real estate.
Q: With Los Angeles on the cusp of reopening, what do you anticipate or hope will happen for the real estate market?
Hyland: Buyers have had very little inventory to choose from recently, so we’re hoping to see more homes hit the market as restrictions lift and the selling process returns to normal.
Mills: There has been a lot of pent-up desire for in-person home tours. I can see the increase in showings and predict those showings will turn into home purchases.
Schulz: People will feel more comfortable selling their homes and inviting the public inside for open houses and viewings, as well as a comfort to travel and possibly list their homes for sale knowing coronavirus has diminished.
Beatty: It seems like anyone waiting to list their home due to health concerns will do so in the latter half of the year. We hope for increased inventory that will give buyers more choice. While we may see a slowdown as people take advantage of the ability to travel over the summer, we anticipate a robust market through the end of the year.
Q: During the pandemic, people had an option to work remotely, and some even left Los Angeles. Do you think they will turn into second home buyers? What does that market look like?
Mills: I have seen many people purchase second homes during the last year. I think some of these buyers thought these second homes would be their permanent residences, but now that we are seeing things get back to normal, I see many people wanting to be back in the city.
Beatty: I think the pandemic will permanently shift the way people interact with work. Since remote work is widely accepted, purchasing a second home is more attractive than ever. This fact is illustrated by the extraordinary strength in secondary home markets like Palm Springs and Lake Tahoe.
Schulz: I think the second home buyer market has always flourished in Los Angeles, especially Malibu and the coastal zones.
Hyland: Aside from a select few big names, the majority have remained in Los Angeles. Our market remains a highly desirable one.
Q: What is the best advice you can offer to someone who is looking for an agent?
Schulz: One of the most important pieces of advice we can give is to choose a real estate agent who knows your area - someone that has a track record for success at the top of their local market.
Beatty: PLEASE choose an experienced agent who you get along with. While timelines may be shortened in certain transactions, the complexity is significant and agents with years in the business are capitalizing on their know-how and relationships to successfully negotiate the twists and turns involved in the purchase of a home.
Mills: Work with a seasoned agent who has knowledge of the market and can direct you to make a good investment as well as find you the perfect home. The agent you choose should also be looking at the future resale value and advise you appropriately.
Hyland: Make sure you are working together with someone who has the integrity, experience and fortitude to help see you through the entire buying or selling process.
Q: With Los Angeles now reopening is there anything else you’d like to let potential buyers or sellers know about today’s real estate market?
Mills: After being an agent for 30 years and hearing people say they are going to wait until the market makes a correction, I am convinced that now is the time to buy.
Schulz: I’m available at any time to discuss the local real estate market in detail.
Beatty: About every 10 years I think to myself, “I should have bought that property 10 years ago - it would have been worth so much.” Housing is an amazing investment in Los Angeles. As one of my colleagues says, “Don’t wait to buy real estate, buy real estate and wait!”