California’s Housing Market

Facts about Housing Market 

1. Forecasts Have Been Downgraded, But Few Economists are Calling for Recession Yet: Last week, the International Monetary Fund (IMF) cut its forecast for global economic growth by 0.1%, but is still calling for an expansion in 2020, albeit at a slower pace. Similar orders of magnitude have been forecast for the domestic economy, with groups like Wells Fargo and others expecting GDP to grow by 10-20 basis points slower than their pre-Coronavirus forecast. Growth is expected to be slower, but the economy is still expected to grow.

2.Mortgage Rates Will Likely Remain Low, Or Even Fall Further As A Result of Coronavirus: The Federal Reserve issued an emergency 50 basis point cut to their target interest rates, and guidance suggests that the Fed may be open to future reductions in order to counteract the negative impacts to financial markets. This should help to reduce the cost of borrowing and make housing more affordable over the near term, which should help to offset some of the negative impacts to housing demand associated with rising uncertainty.

3. Domestic Buyers May Be Discouraged By Rising Uncertainty and Recession Risk, But Is It Still a Good Time to Buy?: This week, mortgage rates fell to an all-time low level of just 3.13%. That is down from 3.80% at the start of the year and represents significant cost savings over the life of a 30-year loan. For buyers who can afford their monthly payments, the economic uncertainty that is driving rates lower provides an opportunity to capitalize on significantly reduced borrowing costs that they will enjoy for years to come. Short-run risks to the economy exist but are arguably offset by long-run benefits of lower rates at the individual level.

4. Financial Market Volatility Could Reduce Demand For Luxury Homes, But Also Create Potential Opportunities for Luxury Home Buyers: The recent turbulence in financial markets has already impacted household wealth. This could reduce demand for luxury homes in California in particular. However, with less luxury buyers, there could be opportunities for price discounts for buyers who choose to remain in the market for high-end properties. Real estate may also act as a buffer against potentially larger declines in the financial markets.

5. Low Rates and Fewer New Homes Constructed Should Place Upward Pressure on Home Prices: Improved affordability stemming from lower rates combined with fewer new homes being constructed as the construction supply chain is impacted could lead to more upward pressure on home prices in California. Unsold inventory is already at low levels, and reduced construction activity means that is likely to continue—especially if buyers respond to lower rates. 

What IS REAP?

REAP

Effective July 15, 1998, the city of Los Angeles City Council approved Ordinance 172,109, establishing the Systematic Code Enforcement Program. The Systematic Code Enforcement Program mandates that the city of Los Angeles inspect residential dwellings with two or more units every three years. The purpose of SCEP is to ensure that residential dwellings are maintained free of any issues relating to life and safety, or general habitability.

What is REAP?

The Rent Escrow Account Program (REAP) is an enforcement program managed by the Los Angeles Housing Department, enforcing code violations based on orders. The REAP program forces an owner to bring the property into compliance, with consequences including but not limited to rent reductions to your tenants, REAP administrative fees, and a cloud on the property title.

REAP vs Code Enforcement

Even though the REAP program and the Code Enforcement program can work hand in hand, they are two different programs. The REAP program is an administrative enforcement process, and is a consequence of non-compliance with housing codes identified by an inspection conducted by the Housing and Community Investment Department of Los Angeles. The consequences an owner can face through the REAP program are financial and property related only. The Code Enforcement program, however, can lead to criminal consequences. If you violate Code Enforcement requirements, your case can be sent to the REAP program, as well as to the City Attorney for possible criminal charges. A property owner can go to jail for failure to maintain their property in a safe and habitable condition.

California’s New Rent Laws

Did you know?

The entire State of California is now under NEW RENT CONTROL LAWS. It is critical for landlords to be in compliance and stay up-to-date with the new continuously changing rules that have become effective as of 2020. We are a Multi Family Resource Specialist Team that provides guidance to Landlords and Consult with you regarding your Real Estate Goals.

Questions I Can Answer

● Compliance with all Rent Control Laws

● How to maximize your investment as a Landlord

● Have Equity in your Property/Home You would like to Invest

● Out of State Investments

● Free Market Value on Properties and Rents

California law limits the amount your rent can be increased. See Section
1947.12 of the Civil Code for more information. California law also provides
that after all of the tenants have continuously and lawfully occupied the
property for 12 months or more or at least one of the tenants has
continuously and lawfully occupied the property for 24 months or more, a
landlord must provide a statement of cause in any notice to terminate a
tenancy. See Section 1946.2 of the Civil Code for more information.

Keller Williams Brokerage

Who you are in business with matters.

We’re #1. Holding the top spot in agent count, units and sales volume, our sales force is one to be reckoned with. Home to the Tech-Enabled Agent, our business model equips agents with a technological edge and the ability to offer customers whatever they wish.

Our Mission

To build careers worth having, businesses worth owning, lives worth living, experiences worth giving, and legacies worth leaving.

Our Perspective

A technology company that provides the real estate platform that our agents’ buyers and sellers prefer. Keller Williams thinks like a top producer, acts like a trainer-consultant, and focuses all its activities on service, productivity, and profitability.

Our Beliefs

Win-Win:  or no deal
Integrity:  do the right thing
Customers:  always come first
Commitment:  in all things
Communication:  seek first to understand
Creativity:  ideas before results
Teamwork:  together everyone achieves more
Trust:  starts with honesty
Success:  results through people


Our Values

God, Family, then Business

Real estate is about relationships. The best ones become reciprocal; the more you put into them, the more you get out of them. When technology was added to the equation, sustaining those relationships became more challenging, so we pivoted toward agent-directed tech to prioritize relationships and benefit everyone who touches real estate.

We started with two clear goals in mind: to keep the agent as the fiduciary at the center of the transaction, and to create an experience that better serves the clients who trust them with the biggest investments of their lives.

We cemented bonds between people, data, systems, and communication, creating a journey that has no end. Today, we honor agents and consumers by supporting them with groundbreaking tech to fuel their future.