What Does 2021 Have in Store for the Southern California Housing Markets

In November 2020, the median home prices in Los Angeles increased by 11%, while total sales increased by nearly 20%. The reason for this is not still fully understood, but we know it’s a combination of COVID, the fed’s mortgage interest rates, and the home-supply-crisis. Moreover, the victims of COVID are heavily skewed on a socioeconomic basis; the wallets of those in the higher tax brackets have come out relatively unscathed.
We are a society that loves pithy phrases, and the pithy phrase of today is “all good things must come to an end;” the question is when that will happen. Experts appear to agree that 2021 will be a good year for the Los Angeles and Orange County real estate markets, predicting price growth of somewhere between 7% and 10%. The optimism about 2021 is further bolstered by the fact that interest rates are expected to remain low, higher income earners have not been impacted, and the supply shortage is conducive to aggressive bidding wars; in other words, the Southern California housing market is looking very bullish going into 2021.
On the other end of the spectrum, some housing experts predict that 2021 will slow down significantly, assuming we get the virus under control. The premise is that the virus, and accompanying industry shutdowns, have been the catalyst for people looking for new homes. Once businesses reopen, and COVID is slowly defeated, there will be less people in the market. As demand decreases, even where there is a shortage in supply, the total price comes down as the tension between the two forces decrease.
At the Chernov Team we understand that knowledge is power, and knowledge of how the market is behaving is powerful knowledge indeed. At the Chernov Team we know that whoever comes to the table most prepared leaves with the most, and the Chernov Team always leaves the table with the most.