In this ongoing series I will attempt to determine which local real estate market in the United States is actually the hottest.
Beauty’s in the eye of the beholder but heat can be detected with a thermometer so I will focus on objective metrics, facts, and statistics in this summarized evaluation.
Here’s 3 reasons why the Southern California market should top your list as the hottest:
#1 – Foreclosures in California are at an 8 year low.
Less people falling behind on their mortgage means that more people have a reliable income and are more stable financially.
Therefore, it’s only natural to expect that the people who have been “hanging in there” for years will now want to upgrade and expand or trade up to a better area or a bigger house.
#2 – The median sales price is up over 20%.
This is bad news for home buyers but great news for California home owners.
The Los Angeles Times reported recently that “home affordability” fell in the last quarter of 2013 due to the fact that property values continued to increase.
#3 – Houses are in short supply.
John Burns Real Estate consulting published a report recently documenting the fact that homes available for sale in Southern California is currently at a 20 year low.
It is somewhat complicated how the inventory of available homes is calculated but this stat still illustrates how much room this market has left to grow.
Before slowing down in the fourth quarter of 2013, the summer season saw an increase in sales price year over year of over 28% as reported by Andrew Khouri for the LA TIMES.
Real estate is seasonal and cyclical and experienced professionals expect sales to increase in the summer and cool down in the fall.
Therefore, the best measure for judging which market is the hottest is how high the flame raises when it really heats up and how low it falls when it starts to cool down.
Now it’s over to you, do you agree that SOCAL is the hottest real estate market in the US?
[Source: AP, CoreLogic Inc.,LA TIMES (Andrew Khouri, Southern California housing market slows after torrid rebound]
[Image Credit Flickr: ]