The first quarter of 2014 is done and prices in Eagle Rock, NELA and Los Angeles in General continue to climb as inventory decreases. This is economics 101, supply and demand. Right now there are many buyers competing over limited inventory so almost everything is getting multiple offers and selling over the asking price. The median single family home prices are over $600,000 in most areas of NELA, this is nearly back to the peak price level seen in 2007. Year over year NELA is up 34%.
Many people ask me if this is another Real Estate Bubble. The major difference between that market and this one is that now about 1/3 of the properties are bought with all cash and lenders are very tight with underwriting guidelines demanding buyers show proof of income and have down payments. The previous bubble was largely influenced by easy credit-nearly anyone could get a no money down loan without having to prove their income. This time around the buyers can actually afford the houses they are overbidding on. The increasing prices are supported by strong demand from fundamentally stronger buyers.
The numbers for all of Los Angeles County confirm the boom:
In my neighborhood of Eagle Rock, the Median sales price is now back over $627,000.
The market is hot and appears to only get more competitive. Right now I have half a dozen buyers who cannot get an offer accepted because they keep getting beat by other desperate buyers. It's a jungle out there, dress accordingly.