Things To Know Before Buying a House in California
A person buys a new house for a few reasons: Work opportunities, starting a family, or a better lifestyle. Buying a house is a crucial decision as here you will be creating precious memories with your loved ones. Our article focuses on buying a house in California aka the golden state. The beautiful beaches and warm weather are all the more reasons to settle here. Let’s dive deeper into the process of buying a house in California.
1- Housing Market of California
California’s housing market is considered the most valuable in the country as it is a hot seller’s real estate market, recorded at a rate of 21.3% out of nationwide. 2022 has observed stability in prices, improvement in house supply, and ease in competition, according to the California Association of Realtors (CAR). So, this might be a good time for buying a house in the state.
2- Consider the Costs while Buying a House in California
Housing in California is relatively expensive compared to other states. When comparing house prices and cost of living, the golden state: California does not come for cheap. The median home value in California was considered the second highest after Hawaii. The home worth of California is recorded at $745,200, whereas Hawaii has a value of $729,100.
3- Home Prices Will Grow Steadily
California is a realtor’s hot seller market, so prices continue to rise. However, compared to last year, they will grow more slowly. 2021 marked an astonishing increase in house prices in the golden state. Fortunately, the rate is expected to slow down this year.
4- Prices Are Still Rising in Major California Cities
According to the California Association of Realtors (C.A.R.), home prices in California were up double digits year over year by the end of 2021. Those looking to purchase their first house in California in 2022 may face higher costs in major cities such as Los Angeles, San Diego, and San Jose.
5- Inventory Levels Remain Confusing
With the complex situation prevailing, buying a house can be frustrating for first-time buyers. Supply and inventory shortages remain a problem for many. The housing market is supposed to come sturdy around spring driven by interest rates.
6- Covid-19 Issue for Buying a House in California
Rent prices have increased tremendously to the shock of renters. To consider an example, one-bedroom apartments in Irvine marked an increase of 36.25 percent year over year. Pandemic recording people moving from urban to suburban areas. It caused increases in the rents of suburbs.
Previously not many people inhabited suburbs, but after the peak rise recorded after the shift, outskirts have recorded shortages in housing supply. Rents have also increased drastically.
7- Mortgage Rates Continue to Trend Upward
The rates of mortgages will continue to rise in 2022. Mortgage Bankers Association has predicted a gradual increase in home loans with their respective interest rates this year. The 30-year fixed rate of a mortgage had climbed high, recorded at its highest rate since the start of the pandemic 2020.
Due to high mortgage rates, housing demand has slightly decreased before the spring season. The supply still stays short, making the market competitive.
8- Real Estate Sector Will Be Favorable to Sellers
Over the last year, numerous reports reported on California home buyers trying to find a home. The real estate market is becoming difficult for first-time purchasers for several reasons: Fierce competition, limited inventory, and rapidly rising costs.
While the real estate sector may become more “buyer-friendly” in 2022, it will almost certainly continue to benefit sellers for the time ahead. The main cause for it is the lack of housing supply.
Visit Regentology for Buying a House in California
Regentology is a platform that connects buyers and sellers with the right real estate professionals. We simplify buying a house for you by removing the complexity. Regentology will assist you in finding a home in California that meets your budgetary requirements. We’ll put you in touch with the best local professionals that can assist you throughout the process. To receive a free consultation, simply fill in the form.
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