The end of December 2016 is here, and on this day, only 461 residential homes are listed active for sale in all of Long Beach and Lakewood, California, down from 564 at the beginning of the month and 682 just 2 months ago today, showing an 18% decline in inventory in just 30 days and a 32% decline in inventory in just 60 days!
Though this is normal at the end of the year, the numbers do seem very pronounced this year – a rapid drop in supply as sellers decide to wait till next year to list their home, while lots of buyers were still buying before the end of the year, since we had a bump up in interest rates after the election, and many buyers were looking to lock in at a good interest rate before rates go up further in the new year.
In the month of December 2016, 368 homes sold/closed escrow in Long Beach and Lakewood, California, up from November’s 342 closed. Strong demand for homes.
This means we now have only a 1.25 month supply of inventory, down from 1.6 months inventory in December!
Let’s see how it breaks down in some different price points:
Of the 461 residential homes listed for sale right now:
- 104 are priced at $800,000+ (115 last month).
- 37 homes sold in the month of December at $800,000+ (41 last month)
- That’s a 2.8 month supply (unchanged 2.8 month supply last month)
- 186 are priced $600,000+ (230 last month)
- 117 homes sold in the month of December at $600,000+ (108 last month)
- That’s a 1.6 month supply (down from 2.1 months supply)
- Drastic cut in supply in the price point between $600,000 and $800,000 along with consistent demand
- 227 are priced between $300,000 and $600,000 (272 last month – continued drop)
- 210 homes priced $300,000 to $600,000 sold in the month of December (200 last month)
- That’s a 1.1 month supply of homes in this price range (down from 1.4 last month)
- 51 are priced $300,000 and less (67 last month)
- 50 homes priced under $300,000 sold in the month of December (36 last month)
- That’s a 1.0 month supply of homes in this price range.
What we are seeing here:
- After the election, a bump up in interest rates and the fact that the election was finally over made people on the fence rush into the market and buy before rates go up further. Demand increased while supply decreased.
- Most sellers are still waiting till “after the first of the year” to put their property on the market, resulting in very low inventory (1 month inventory in the lower price points, only 1.25 months inventory overall – the lowest ALL YEAR!)
- The expectation is that after the first of the year, there will be an increase in inventory in the market, and an robust January of home sales in the area.
- If you’re looking to sell your home, the current low inventory setting will be advantageous to you, allowing you to negotiate a strong selling price, and when the holiday is over next week, the buyers will be back in full force!
- If you’re a buyer, stay tuned, there should be more good, new inventory hitting the market in the next 30 days. Let me know when you want to go shopping!