Source: Los Angeles Times —
Stephen Jackson lost out on more than a dozen properties as home prices surged during the pandemic housing boom. He finally called off his search in 2021 when someone outbid him for a Tarzana condo by $25,000 — and paid in cash.
“I was like, ‘I am never going to get a freaking home here,’” the 31-year-old human resources manager said.
Last year, mortgage rates exploded, making the sky-high prices even less affordable and tanking home sales.
When his roommate decided to move in October, Jackson chose to look again, this time seeking deals swirling in the crosscurrents of the real estate fallout.
Last month, he made an offer on a two-bedroom condo in downtown L.A. that had languished on the market for 72 days. At $20,000 below the $450,000 list price, his offer — the only one — was accepted.
“All my friends were shocked I bought a home right now, and I was like, ‘Why wouldn’t you?’” Jackson said.
Demand for homes is a far cry from the height of the pandemic housing boom, but Southern California real estate agents and mortgage brokers say they’ve been seeing more people like Jackson dip their toes into the market to take advantage of momentary opportunities.
Mortgage rates — though elevated — have come off their 7% highs, and home prices have fallen as sellers struggled to get offers.
In L.A. County during the four weeks ended Feb. 5, the number of signed purchase contracts was 42% below the same period last year, according to data from real estate brokerage Redfin. Still, that’s an improvement from the 51% drop seen at the start of December.
“The temperature in the room is still cold,” said Taylor Marr, an economist with Redfin. “But it’s not frozen.”
Whether the modest rebound will hold is unclear. Returning buyers may need to rapidly adjust what they can afford.