What Did You See in 2013?

Today I wanted to give you a recap of 2013 in the Long Beach market and what we can expect moving forward into 2014. 2013 began as a buyer’s market due to the cushion of inventory that was being addressed by investors. Shortly after the first quarter, we had a lot of hedge funds coming primarily into the Blackstone and began to scoop some of the short sales and R.E.O.’s. After this, the market transitioned to favor the sellers and by mid-summer, it felt like it was 2006 again. It was quite common to see multiple offers, homes that were selling prior to listing, removal of all contingencies and non-refundable deposits. As we moved into fall, the market still favored sellers as inventory remained low.

Interest rates started out historically low again and by summertime, we saw them bump up. The rise in interest rates and low inventory created a hold in the market; it seemed that buyers didn’t know what to expect and that brought the market to a screeching halt. This hold felt very similar to when the tax credits expired in 2011, although fall showed the market pick up in the sub-$500,000 market.

I believe 2014 will start out very similar to the fourth quarter of 2014. Inventory is still down and I do expect interest rates to rise and this will keep the market quiet. Sellers will most likely hold off from putting their homes on the market until after the New Year and I don’t think we will see an influx of inventory in February; the market will remain steady and quiet.

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