Chill may have hit L.A. County’s housing market

first_img 160Want local news?Sign up for the Localist and stay informed Something went wrong. Please try again.subscribeCongratulations! You’re all set! November may have brought a chill to the housing market. That doesn’t mean that potential buyers will catch much of a break, though, since prices and interest rates are heading in opposite directions. But retreating to the sidelines might not be a sound strategy, either. A variety of forecasts indicate that sales will set a record this year in Los Angeles County and all of California, then dip slightly in 2006. Prices peaked in the summer in most areas – the San Fernando Valley’s $600,000 record median single family price came in July. It’s fallen every month since, though not by huge amounts. This isn’t unusual, either. Last year’s record was $505,000 in June, then the median price, the point at which half the units cost more and half less, remained under that point until January, when it hit $521,000. Then that record fell every month from March through July. So at this point, it’s tough to differentiate between a seasonal and fundamental change. “But there is evidence the market is slowing down a little bit,” said analyst Nima Nattagh, who consults for the home loan industry. Deals are taking longer to strike, sellers are not being as outrageous as in months past in setting the price, and inventory is creeping up, albeit from extremely low levels. That pattern has been in place for a couple of months. Interest rates might cancel out these positives. Mortgage giant Freddie Mac reported Thursday in its weekly survey that benchmark 30-year rate hit its highest level in 16 months. That rate was up an annual 10.8 percent, the 15-year fixed was up 15.2 percent and the one year adjustable was up 27.2 percent. The weekly Mortgage Bankers Association report showed a similar result. Long and short term rates are getting closer to each other and that means the latter might not be much of a bargain. Chris Bates, research analyst at Novato-based RealFacts, which tracks the apartment market, said that rents in the Los Angeles area have only increased about 6.3 percent from a year ago at the end of the third quarter. Housing prices have been jumping by three and four times that. “Renting, for the past four years or so has been a bargain and we don’t see anything to suggest that’s going to change,” he said. Certified financial planner Simon Singer, owner of the Adviser Consulting Group in Encino, believe there is a lot more room for rates to go up than down. Buying a house to live in and holding onto it for a few years is probably a better move that counting on making a quick profit, despite how much residential real estate has appreciated in the recent past. He offers this caveat, too. “Trying to time the market in anything is a mistake. There have been far more fortunes lost than won in trying to time markets.” Calabasas-based Countrywide Financial Corp., which is a sponsor of the Target World Challenge, Tiger Wood’s annual cash fest in Thousand Oaks, added a different racket to its portfolio. The company has agreed to be title sponsor of the men’s professional tennis event at the Los Angeles Tennis Center-UCLA through 2008. It will be called the Countrywide Classic and be played July 24-30. Terms were not disclosed. Gregory J. Wilcox, (818) 713-3743 [email protected]last_img

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