The SchifferLine
Timely Real Estate News……………………………15  March 2022

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Median sales prices continue to show strong increases
The Multiple Listing Service (MLS) has recently upgraded their data collection and reporting formats, and from now The Schiffer Line will be presenting this data on the five major communities I report on regularly — Beverly Hills, Beverly Hills Post Office, Bel-Air/Holmby Hills, Brentwood and Westwood/Century City. The new format combines both Beverly Hills and the Post Office, so that information will be reflection of both communities. I am and will ty to separate the stats for the two communities, particularly as I am some difficulty understanding how the stats account for their numbers. The reformatting has expanded some of the reporting areas, which means our data will reflect only the current configuration which offers a broader view of what is happening in these communities. Each month, I will continue to cover other communities where I also work, and this month I will be reporting on Venice.

The good news is we continue to see median sales prices continue to be strong in all of these areas for January-February 2022. The Beverly Hills report now includes and has seen a 78% risein median sales prices from $2.714 million to $4.950 million compared to the two first months2021. Bel-Air/Holmby Hills showed an 81% increase in median sales prices from $2.725 million to $4.140 million. Brentwood had a 3% increase from $2.141 million to $2.220 million, and Westwood/Century City had a 17% increase — $1.045 million to $1.223 million. For Venice, median sales prices went from $1.790 million to $2.100 million, a 17% increase. As always, we have seen some extraordinary numbers for sales, for example, there were 10 sales over $7 million with the most expensive one coming in at $24,137,392. The Post Office had 6 over $7 million again with the topper at $58,000,000! Bel Air coming in with its highest sale at $37,000,000 of the 4 sales over $7 million (and let’s not forget the auction of the house – The One which sold at $125,000,000 , against an asking price of $250,000,000 which will most likely be in the MLS report for March). Brentwood had 4 sales over $7 million starting at $15,305.547, and Westwood/Century City 1 sale over $7 million at $9 million. The Venice, Playa del Rey, and Playa Vista areas did not have any sales over $7 million with the highest one in Venice coming in at $5.900,000.

In comparing February 2022 median sales prices to 2021, Beverly Hills was up 24%, Bel-Air/Holmby Hills was also up 24%, Westwood/Century was up 25% and only Brentwood was down 9%. Venice’s MSP were down 6% compared to same time last year. I have not separated Beverly Hills Post Office median prices from the Beverly Hills prices.

Average Days on Market were down substantially — Beverly Hills was down to 53 days; Bel-Air/Holmby Hills was down to 51 DOM; Brentwood was down to 38 days; and Westwood/Century was down to 44 DOM and Venice to 75 Days on Market. All areas are coming down for DOM because of the intense competition for reduced inventory. This condition will most likely not change for some time.

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Sales robust in all areas….

Without question, the sales volume increased substantially, and The Schiffer Line is starting with a new baseline for the above communities, and we will be comparing total sales vs. the new reformatted sales data as of February’s 2022 report. Total sales for the five communities I regularly report on for the first two months of 2022 were $1.284 billion — with Beverly Hills leading the way with $611 million, followed by Westwood/Century with $250 million, Brentwood with $206 million and Bel-Air/Holmby Hills at $142 million. Venice had $117 million through February 2022.

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High-end Westside sales move up, but more slowly
During the past 12 months, we have seen dramatic increases in high-end sales (those above $5 million) on LA’s Westside. However, as the impact of various global events including the war in Ukraine and rising inflation, we are seeing a marked slowdown in high-end sales.

But we are still ahead of last year at this time. There have been 155 closed sales of $5 million-plus so far this year, versus 137 at this time last year — up 13%. Sixty (60) were $10 million-plus this year, and there were 40 at this time last year, up 50%. Of these, 14 were $20 plus million and there were seven (7) at this time last year, up 100%.
Six of these sales were $40 million-plus and there was only one at this time last year. There are 108 pending sales of $5 million-plus at the moment and 26 of these are $10 million-plus, and one is $40 million-plus.

The 14 $20 million-plus sales so far this year were: 5 in BHPO, 4 in Beverly Hills, 3 in Malibu and 1 each in Hancock Park and Bel Air. Most of the buyers for the $20 million-plus sales were American.

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Preventing fires relies on communities pulling together
Last month, I shared with you six recommendations you can implement to protect your home in case of wildfires sweeping over your area. But individually, homeowners can’t prevent fires by themselves if neighbors are not also well prepared: There are community action programs you can implement. For example, a homeowner’s safety upgrades can be undermined by neighbors who ignore the hazards on their own properties. So, community-wide efforts are crucial.

The framework lays out the following “mitigation elements” for communities to adopt:

•  Clearly defining the community’s boundary, then obtaining an assessment of the community’s fire risk from the local fire district or the state fire agency.

• Identifying an evacuation route that is kept clear of overgrown vegetation, along with a contingency plan.

• Finding the financial resources to support the upgrades needed to meet “clear risk reduction goals.” Cal Fire offers fire prevention grants that can pay for clearing firebreaks and removing combustible material, but the dollars are available only to governmental agencies, tribal groups and nonprofits.

• Developing plans with measurable annual goals for reducing the community’s wildfire risks, as well as steps to increase the awareness and education of community members regarding those risks. Currently, 10 insurers are offering community-based discounts to homeowners, although they aren’t all using the same criteria. The new framework puts forward a standard that all insurers could use to judge a community’s mitigation efforts.

A good place to start is with your local fire safe council, which you can locate on the California Fire Safe Council website. These groups draw up wildfire plans, educate local homeowners about prevention and tackle larger projects to protect their communities, such as clearing brush and creating firebreaks.
I recently learned that some of the bigger insurance carriers will once again be dropping and/or not renewing their current policies as they are no longer insuring homes in California. If you need some assistance, please contact me as there are still a few carriers that are issuing policies, and I might be able to refer you to them. ceschiffer@gmail.com or 310 442-1384 which is my office land line.

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Mortgage rates and a word or two from the Director of Forecasting, NAR Research
Nadia Evangelou, Senior Economist and Director of Forecasting, NAR Research said in her recent Facebook post what I have been saying. “Mortgage rates rose this past week as inflation jumped to its highest level since January 1982. The 30-year fixed rate increased to 3.85% from 3.76% the previous week. While its too soon to know how the war in Ukraine will affect the US economy, it seems that it will continue to put upward pressure on inflation. Most likely the Fed will likely raise short term rates at the meeting next week. This strategy will also push rates up”.

“However, we all need to bear in mind that mortgage rates are still near historic lows. For instance, in 1982 when inflation was rising roughly at the same pace as now, mortgage rates were on the average 16%,

Meanwhile, the economy added nearly 12 million new jobs in the first couple of months of the year despite the spread of the virus. By comparison, about 400,000 new jobs are typically added to the market during the same period pre pandemic”

I am not at all advocating hiding our heads in the sand, not at all, I am simply saying that we all should try to keep the rising mortgage rates in perspective. We have more people returning to the work force and home ownership is still the American dream that we all reach for.

The war-induced drop-in U.S. mortgage rates was short-lived. Rates popped up again last week to the highest level in nearly two years. This may just be the beginning as the war in Ukraine drags on.

“Last week’s data indicates that homebuying competition is picking up as we move closer to the market’s busiest season. National listing prices, which hit a new all-time high in February, continued to accelerate at a double-digit annual pace,” said Danielle Hale, chief economist at Realtor.com.

There is some good news. The inventory of actively listed homes, which is near a record low, saw its fifth straight week of improvement last week.

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However, mortgage delinquencies drop to record low
While mortgage rates were inching upward, the percentage of homes with mortgages that have late payments or are in foreclosure has dropped to the lowest seen on record in more than two decades, according to CoreLogic’s data dating back to 1999.

The nation’s overall delinquency dropped to 3.4% at the end of 2021, with the majority of states posting a year-over-year decrease in delinquencies, according to CoreLogic’s newly released Loan Performance Insights report.

Declining unemployment rates and higher home prices are helping more homeowners stay afloat. “National home prices increased by 18.5% year-over-year, helping more owners regain equity,” Molly Boesel, principal and economist at CoreLogic, writes: “The combination of these dynamics pushed the overall mortgage delinquency and foreclosure rates to the lowest levels that CoreLogic has recorded in more than two decades.”

The data also reflects a time when pandemic-related forbearance aid was put in place to help financially struggling homeowners, although for many owners it had expired by the end of the year. U.S. employment has been robust and home equity levels have been on the rise, both of which have helped keep homeowners from going under. Lenders also reportedly have been stricter when issuing loans during the pandemic, ensuring it was to borrowers who were unaffected by hardships.

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Homeownership is leading source of net worth gains
Homeownership is widely recognized as the leading source of net worth among families. Housing wealth itself is primarily achieved by price appreciation gains, and the nation has seen home prices accelerate at a record pace during the course of the last decade.

A new study from the National Association of Realtors examines the distribution of housing wealth between 2010 and 2020 across income groups and in 917 metropolitan or micropolitan areas. NAR found that during those 10 years, nearly 980,000 middle-income households became homeowners. Within that timeframe, total housing wealth for this income group surged by $2.1 trillion.

“Owning a home continues to be a proven method for building long-term wealth,” said Lawrence Yun, NAR chief economist. “Home values generally grow over time, so homeowners begin the wealth-building process as soon as they make a down payment and move to pay down their mortgage.”

From 2010 through 2020, 529 of 917, or 58%, of metropolitan and micropolitan areas gained middle-income homeowners. NAR identifies these locations as rising middle-income class housing markets, i.e., markets that saw the largest increase in middle-class owner-occupied housing units in 2020 compared to 2010.

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Real estate market slowing down? Isn’t happening
If you’re a home buyer, you may have hoped that the real estate market might freeze up a bit in early January to allow breathing room in a less competitive market. Unfortunately, that doesn’t appear to be happening.

While it is early in 2022, the National Realtors Association monthly housing report shows that the real estate market is starting off just as competitive as 2021′s.

The typical home sold in 61 days in January, which is 10 days less than in January 2021 and nearly a month (29 days) faster than the typical pace of sales in January between 2017 and 2020, according to realtor.com. In some of the hottest markets, such as Nashville, San Diego, San Jose, Denver and Raleigh, homes sold in 36 days or less in January.
While buyers were active in the market in January, the number of homes for sale continued to lag well behind demand. The number of active listings on the market — which includes any home listed for sale, not just those that are recently listed — was down 28.4% in January 2022 compared to January 2021. It decreased 60.4% compared to the number of active listings in January 2020.

New listings, which are those first placed on the market during the month, were also down by 9.1% compared to January 2021 and by 17.9% compared to January 2020.

That imbalance between demand and supply contributes to the rapid increase in prices. The median listing price was up 10.3% in January 2022 compared to January 2021 to $375,000, which represents a 25% jump over the median listing price in January 2020.

In my office, we have been experiencing multiple offers on homes and income properties all across the board in all price points

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What is the hottest new gadget for your home? EV charger
High prices at the pump are inspiring car owners to get an electric-powered automobile (EV), but you will need more than the car to use it. Having a home charger will be on your shopping list, too.
Besides understanding what it will cost to power an EV, it’s also important to know the cost of a key piece of at-home technology: the electric vehicle supply equipment (EVSE), along with the cost of its installation.
Plug-in vehicles today typically come with the ability to charge at home on standard household current, 120 volts, which is called

Level 1 charging. They also can charge on faster 240-volt circuits, called Level 2 charging. If the vehicle has a small battery, under 10 kWh, you can often make do with the Level 1 charging system that comes with the vehicle. For plug-in cars with larger batteries, Level 2 is your best bet for overnight charging and quick top-ups
Most automakers with plug-in vehicles in their lineups have a preferred charger provider, but there are dozens of companies selling EVSEs. A search online will help you find the features, power output and pricing that best suit your need. Just search for “EVSE” or “EV home chargers.” Prices for quality Level 2 home systems can range from just under $200 to more than $1,000 before installation.

Installation costs for EVSEs vary by region, depending on such factors as local labor rates, materials used, and government permit costs and requirements. The biggest variable is permit costs, which varies from city to city.

Nationally, average costs for a home EVSE installation with short and uncomplicated 10-foot wiring, which runs from the electrical service box to the charging station, range from $800 to $1,300. The costliest region is the Western U.S., where installation can run from $950 to $1,300.

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New listing coming up!
We have some work to do on it before putting it on the market sometime in the next few weeks, but it is a lovely house in Westwood Hills and very convenient to the UCLA campus (available for a short walk particularly helpful what we are paying for gas these days!). Call me & I will let you know when we are ready to show our shiny new face! 310 442-1384 – Carole

Gratitude and acknowledgement of feelings.
Recently I lost a long-time friend and colleague to cancer, and it made me realize once again how grateful I am for all of my family, friends and colleagues and the very strong need to share your feelings with those you love and cherish. It is very important.

 

The SchifferLine
Timely Real Estate News……………………………1 March 2022

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Pre-owned homes sales surged last month
The surge in sales of previously owned homes last month reported by the National Association of Realtors last Friday reflected buyers are rushing into close contracts in anticipation of mortgage rates rising further. Investors made up the largest share of transactions in six years last month.

Mortgage rates have climbed to levels not seen since 2019 as the Federal Reserve is expected to start increasing interest rates next month to tame soaring inflation. Economists are anticipating as many as seven rate hikes this year.

“This is the rush to get in before borrowing costs move higher,” said Jennifer Lee, a senior economist at BMO Capital Markets in Toronto. “Unfortunately, first-timers are being priced out of the increasingly expensive purchase.”
Existing home sales jumped 6.7% to a seasonally adjusted annual rate of 6.50 million units last month. Sales rose in all four regions, with strong gains in the Midwest, the most affordable region. Sales soared 9.3% in the densely populated South, which is experiencing an influx of residents from other regions as companies embrace remote work.

Economists polled by Reuters had forecast sales decreasing 1.0% to a rate of 6.10 million units. And home resales, which account for the bulk of U.S. home sales, fell 2.3% on a year-on-year basis.

Strong demand for housing against the backdrop of a strengthening labor market and massive savings is outstripping supply, curbing sales. Builders have been unable to significantly ramp up construction because of shortages and higher prices for inputs like softwood lumber for framing as well as cabinets, garage doors, countertops and appliances.

According to a report from the National Association of Homebuilders, delivery of these products was taking “months,” raising construction costs and delaying projects started raced to a record in January.

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War in Ukraine could force Fed raising rates
We are all connected, and the Federal Reserve is taking notice of the war in Ukraine as it could have an impact on inflation pressures already being felt in the U.S. The war in Ukraine is not likely to prevent the Federal Reserve from raising interest rates next month, but any worsening of inflation pressures could force the central bank to tighten policy even more aggressively than already hinted by senior officials. All of this circles back to mortgage rates which are trending upward since January.

In public comments and interviews last week, Fed officials endorsed plans to lift rates at their March 15-16 meeting. They said it was too soon to tell how the war will affect the economic outlook, but they are monitoring developments carefully.

Their problem is that they had anticipated U.S. inflation, now running at a 40-year high to peak this quarter. Geopolitical developments that push up prices through the spring, particularly for energy and commodities, could force the Fed to accelerate rate increases this summer, which would raise the risk of a recession next year.

During geopolitical shocks, the Fed generally avoids taking steps that increase uncertainty. But with inflation running far above its 2% target and the Ukrainian crisis threatening to push prices even higher, the Fed could face considerable urgency to continue with planned rate rises.The global economy has been recovering from a series of “supply shocks” in which shortages of goods or services drive up their prices. Textbooks call for central banks not to react to one-off increases in prices that result from temporary factors, such as natural disasters, and to instead focus on broader underlying inflation pressures.

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Climbing mortgage rates hurt potential homebuyers, re-fi markets
Rising mortgage rates are hitting both potential homebuyers and refinance candidates. Total mortgage applications decreased 13.1% last week to the lowest level since December 2019, according to the Mortgage Bankers Association. Applications to refinance dropped 15% weekly and were 56% lower than one year ago.

“Higher mortgage rates have quickly shut off refinances, with activity down in six of the first seven weeks of 2022,” said Joel Kan, MBA’s associate vice president of economic and industry forecasting.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($647,200 or less) increased to 4.06% from 4.05%, with points rising to 0.48 from 0.45 (including the origination fee) for loans with a 20% down payment.

Those higher mortgage rates combined with high prices and low inventory pushed applications to purchase a home down 10% weekly and 6% lower than one year ago. This was the third straight week of declines for purchase applications.

The average purchase loan size in the MBA weekly survey did not increase, but at $450,200, it stayed very close to the survey’s record high of $453,000, which was hit the week ended Feb. 11.

Home prices have been climbing steadily and did not let up in 2021. The S&P CoreLogic Case-Shiller Home Price Index was released last Tuesday, and 2021 registered the highest calendar-year increase in 34 years, according to Craig J. Lazzara, managing director at S&P DJI. Prices nationally were up 18.8% in 2021 versus a 10.4% gain in 2020.

Rising mortgage rates will pose a challenge for some buyers, likely leading to less demand. Lazzara predicts that price growth will soon slow in reaction to higher rates.

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Home prices slowed in 4th Quarter, albeit still moving upward
The fourth quarter of 2021, much like the third quarter, saw home prices continue to increase, although at a slower pace. Fewer markets in the last quarter experienced double-digit price gains.

According to the latest quarterly data, out of 183 measured markets, 67% of the metros reached double-digit price appreciation compared to 78% in the prior quarter. Nationally, the median single-family existing-home price rose at a slower rate of 14.6% year-over-year to $361,700 compared to the year-over-year pace in the previous quarter (15.9%).

While the third quarter of 2021 witnessed all regions achieve double-digit price gains, the fourth quarter saw only the South experience double-digit price appreciation (17.9%), and single-digit price gains in the Northeast (6.8%), Midwest (8.6%), and the West (7.7%).

California led the way with five metros in the top 10, along with five other areas, including: San Jose-Sunnyvale-Sta. Clara, Calif. ($1,675,000; 19.6%); San Francisco-Oakland-Hayward, Calif. ($1,310,000; 14.9%); Anaheim-Santa Ana-Irvine, Calif. ($1,150,000; 23%); San Diego-Carlsbad, Calif. ($845,000; 14.2%); Los Angeles-Long Beach-Glendale, Calif. ($797,900; 15.9%).

“Homebuyers in the last quarter saw little relief as home prices continued to climb, albeit not as fast as earlier in the year,” said Lawrence Yun, NAR chief economist. “The increasing prices are indicative of a seller’s market, with an abundance of eager buyers and very limited supply.”

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Homeownership climbed in US to 65.5%
In a report just released by the National Association of Realtors, U.S. homeownership rate climbed to 65.5% in 2020, up 1.3% from 2019 and the largest annual increase on record.

More Americans are likely to own a home now than during any year following the Great Recession (65.4% homeownership rate in 2010); however, Black Americans continue to face significant obstacles along the path to homeownership, according to the NAR. The homeownership rate for Black Americans – 43.4% – trails behind that of a decade ago (44.2% in 2010). Conversely, White Americans (72.1%), Asian Americans (61.7%) and Hispanic Americans (51.1%) all achieved decadelong highs in homeownership in 2020, with the rate for Hispanic Americans setting a record and reaching above 50% for the first time.

NAR’s report examines homeownership trends and challenges by race and location to explain current racial disparities in the housing market. Using data from the 2021 Profile of Home Buyers and Sellers, the report looks at the characteristics of who purchases homes, why they purchase, what they purchase and the financial background for buyers based on race.

“As the gap in homeownership rates for Black and White Americans has widened, it is important to understand the unique challenges that minority home buyers face,” said Jessica Lautz, NAR vice president of demographics and behavioral insights. “Housing affordability and low inventory has made it even more challenging for all buyers to enter into homeownership, but even more so for Black Americans.”

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Guess who is grabbing land near big cities. Self-driving trucks!
The prospect of self-driving trucks could further intensify a land grab near big cities, one that is already fueled in part by the increase in long-haul trucking during the pandemic.

Alterra Property Group, a real-estate investor based in Philadelphia, said last week that it has launched a partnership

with autonomous-truck company Embark Trucks to buy property across the U.S. near major city hubs.
Embark, which went public in November in a $5 billion deal, plans to commercially launch the first trucks using its software in Sunbelt states such as California and Texas in 2024. The autonomous trucks would drive on highways, then pass on the trailers to human-driven trucks for the final stretch of city deliveries.

To do that, Embark needs numerous so-called transfer hubs close to highways on the outskirts of cities to park and switch trucks. Under its partnership, the company plans to initially lease these sites from Alterra.

The emergence of self-driving trucks comes as Americans’ voracious demand for electronics, household wares and other goods during the pandemic has been boosting amount of truck traffic. Truck operators need land near big population centers to store their vehicles.

But that land is scarce. For one, developers have been buying up outdoor facilities for use as e-commerce warehouses. And strict zoning rules mean that few sites qualify for truck storage. “You can’t just put a truck anywhere,” said Alterra’s co-managing partner, Matthew Pfeiffer.

That is creating a significant supply-and-demand imbalance. Investors are looking to profit by buying up these hard-to-find sites and renting them out to logistics or traditional trucking companies under five- or 10-year leases.

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Realogy, Coldwell-Banker’s parent, grows market share
Realogy earned $8B in 2021 revenue, $2B in Q4, as the parent of Coldwell-Banker, market share grew as well. Strong transaction, sales volume and market share growth boosted Realogy’s revenue as CEO Ryan Schneider says platforms like Zillow are company’s true competitors.

Despite a topsy-turvy real estate market marred by inflation, increasing mortgage rates and rock-bottom inventory levels, Realogy reported $8 billion in revenue for 2021 — $2 billion of which the company earned in the fourth quarter.

From September to December, Realogy’s revenue increased four percent year over year to $2 billion — a slight decline from the previous quarter’s $2.2 billion. The franchisor’s net income also grew from $29 million in Q4 2020 to $47 million in Q4 2021. Likewise, the basic earnings per share rebounded from $0.24 per share to $0.40 per share.

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Is there help in the wings for concerns about fire insurance?
Given all of the recent attention and concern about the increased potential and length of wildfires, and the difficulty for those of us who live in fire prone areas to get fire insurance, according to a recent article in the Los Angeles Times state officials have issued a “Safer from Wildfires framework.

The framework lays out a list of upgrades that individuals as well as local governments and community groups should take. I have shared some of those suggestions in past Schiffer Lines but will do so again. These suggestions are drawn from best practices outlined by the consumer group United Policy Holders, the Institute for Business & Homes Safety and Cal Fire, among others. The recommendations are the results of an effort begun a year ago by Insurance Richard Lara and several state agencies involved in firefighting and prevention.

Today, 13 insurers with 40% of the market in the state are offering discounts to homeowners who have made fire-related safety improvements or who live in communities that have done so.

Here are six (6) recommendations to help making your home more fire resistant – Installing a roof rated Class A for fire resistance – Creating a 5 foot wide zone around the house for example laying down gravel or stone walkways in place of mulched flower beds – Removing combustible material such as untreated siding – blocking the entry of burning embers by covering vent openings with fire-resistant metal screens – installing double pained windows or fire resistant shutters – Enclosing the eaves to prevent burning embers from drifting into your attic. I will have more information on my next issue of Schiffer Line on the 15th of the month. Stay tuned!

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My Life
Recently I have been living the highs and lows of life in celebrating my birthday last week. The amount of celebrating with friends and family has been amazing. Between the flowers, and candy, it has been awesome// THANK YOU ONE AND ALL!

As some of you may recall, we lost my darling Mother almost two years ago, and due to some complications, we have just closed escrow on her house. Selling the house both my sister & I grew up in was very sad in closing that chapter of our lives, but sweet in the hopes that the young family who will be living there will enjoy it as much as we did. Mom had been a docent at LACMA and had an amazing art book collection which was donated to them and now will be the Kelly Schiffer Library, and some of her fabulous clothes have been given to the Music Center to be used as costumes which would thrill her, in fact she had said that some of them she wanted to be used in that fashion! Thank you to my amazing sister for making that happen!

In the meantime, I continue to work with my buyers and hunt for properties to sell them. There really is a dearth of properties out there, so if you have an inkling of selling, please do let me know. I have some new videos on you tube. Here is the link. https://www.youtube.com/channel/UCjgqPmbfG1ERg5egYACFKKQ. Also, please subscribe to itThey can also be found on my business face book page for the next 10 weeks every Thursday.

I look forward to seeing and speaking with you. Please do not be a stranger. I celebrate that life is somewhat returning to normal (whatever that is or was), and we can all be out and about again. As I was told at a memorial service this past weekend, tell people that you love how you feel about them… let them know how important they are to you… please know that all of you are very important.

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The SchifferLine
Timely Real Estate News………………………..15 February  2022

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Sales volumes rocket upward to start 2022
Make no mistake, there is a buying frenzy going on as we start advance into the New Year as we see sales volumes all across the board including the five communities I report on. In these communities the comparison of sales volume has climbed 139% compared to last year at this time. Sales volume for January was $483 million for 2022 vs. $202 million in 2021. That is the highest annual increase I have seen in my 30-plus years selling real estate on the Westside, and there doesn’t seem to be many roadblocks to increasing sales volumes in the future, unless, of course, inventory becomes a more critical issue. At the moment, the recission rate is 14 days which in the past has been 3 – 6 months. This means that the minute a property comes on the market and if it is positioned properly, the sellers can expect to have an offer within the first week!

Starting out of the box for 2022, Beverly Hills, Beverly Hills Post Office, Bel-Air/Holmby Hills, and Brentwood, all saw strong sales volume increases. Leading sales volume increases for January was Beverly Hills Post Office which saw a $145 million increase over last January’s performance. Beverly Hills, always the leader, was $63 million ahead of January 2021, Bel-Air/Holmby Hills was up $50 million, and Brentwood was up $34 million compared to last year. Only Westwood/Century City showed a decline in sales volume compared to a year ago of 2%. I also cover Malibu, which saw a sales volume increase 18% from $49 million to $58 million over January 2021.

Notably, Beverly Hills had five homes over $10 million, highest selling for $22 million. BHPO had six homes over $10 million, with $15 million being tops. Bel-Air/Holmby Hills had two over $10 million, with the highest at $14 million, Brentwood had four over with $17 million the highest. Sales on Los Angeles’s Westside appear stronger than ever, even as the pandemic continues to simmer throughout California. I expect to see continued sales volumes but, perhaps, more moderate as rates go up. As we continue to fight the inventory battle, sales prices are just going to keep moving up. That is what we are living with today.

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Median sales prices take a big jump, too!
Along with continued robust sales comes robust increases in median sales prices. Compared to early 2021, when median sales prices were in the 4-5%/month increases, we see for January 2022, median sales prices have taken on new strength. For example, Bel-Air/Holmby Hills saw a 112% increase in median sales prices to a new high of $4.450 million, followed by Beverly Hills Post Office which experienced a 77% increase in MSP to $6.024 million.

Beverly Hills started out 2022 with a median sales price of $6.997 million, an increase of 34% over last year. Westwood/Century City had a modest increase of 6% in median sales price at $2.680 million, and Brentwood was off 20% from a year ago at $2.900 million. Malibu had a big jump in median sales price of 83%, growing to $2.581 million.

There is no question that this is a seller’s market. With inventory still behind pre-pandemic levels, buyers are faced with a shrinking market and choices, and multiple offers have become the norm. For many, it’s a stressful experience — waiting in line, even with a bonafide cash offer — doesn’t seem to be enough…you are just one of many swarming over your dream home. And what is interesting is that there are still sellers out there who are over-pricing their homes — and will have to eventually reduce their original listing price so it will sell. My advice — get solid, professional real estate advice before you even enter the market. I can help you avoid a lot of the mistakes many buyers and sellers are making in this tough market.

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How does the increases in mortgage rates factor into the equation?
First of all, we all need to remember that should interest rates increase to the mid to high 5%s, they are still quite low. I remember a few years ago when they were in the 6% range. We have been somewhat spoiled with how low they have been for the last year years.

The increase in interest rates will definitely close some buyers out of the market, conversely it will also act as anincentive for some buyers to take advantage of the current rates and add more pressure on the inventory.

Some of you may recall a situation with an offer I was involved with in early December where there were 25 offers. That escrow just closed escrow, hold on to your hats… for $1,000,000,000 than the asking price. With that same buyer this week, we were involved in another multiple offer for a house in Santa Monica. In this case, there 15 offers. Unfortunately, my client was not the prevailing buyer. We don’t know what the final price will be, but our offer was almost $300,000 over asking!

Look at how many jobs have been created recently. Another factor in the crazy prices we are seeing is the increased cost in land itself (hard to find here), materials, etc. Builders are passing these costs on to buyers and the buyers are paying them.

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Bubble? What bubble? Experts say “No!”
Sorry to burst your bubble, but we’re not in one, housing experts say. Today’s rising home prices and a persistent seller’s market differ from the 2007 housing bubble in a few keyways, economists told Inman. In short, don’t expect bubbles bursting anytime soon.

Historically low inventory leads buyers to make rushed decisions. Bidding wars help push up record high housing prices. Many in the nation’s largest homebuying generation are being priced out of markets nationwide. Are these the signs of a housing bubble?

It is hard not to look at the unpresented territory of the U.S. post- COVID housing market with a twinge of fear that the country is returning to conditions that existed before the collapse around the Great Recession (2007-2009).

As common as the question is these days, economists say today’s market boils down to the simple economic principles of supply and demand. “I was thinking, “What is really a bubble? “Said Selma Hepp, chief economist of Core Logic. “There is no firm definition of a bubble”.

“To some people, high appreciation is going to be a bubble. To others it’s high speculation,” Hepp said. “Generally, among economists we think when there is an increase in speculation, when people are buying based on expectation of appreciation as opposed to that need for housing, that’s when we could be in a bubble.”

Yet there are many more signs that point to a healthy market that was sped up due to unique conditions brought on by the coronavirus pandemic. And in a way, the pandemic may have led buyers who ordinarily might have purchased a first or second home in a few years to do so much sooner.

“One question we don’t know for sure is how many people moved forward to buy a house because of the stimulus and low interest rates that they would have bought this year or next year,” said Doug Duncan, chief economist at Fannie Mae.

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Westside high-end home sales continue upward.
It comes as no surprise but 2022 is starting out with a ‘bang’ for high-end home sales for January. It is interesting to see how the year is beginning after finishing the best year ever in high- end sales. We are almost already even with last year.

There were 66 closed sales of $5 million-plus in January, versus 63 at this time last year. 20 of those were $10 million-plus, versus 23 in January. We are ahead in the sales of $20 million-plus, there were 2 at this time last year and there were 6 in January, 3 of these were over $40 million.

A good start to the year with 101 pending listings of $5 million-plus and 34 of these are $10 million-plus. And it becomes clear, that the record-setting home price trends set in 2021 are continuing as we move into the first quarter for this year. Time will tell, of course, but the continued upward pace of home prices clearly demonstrates the unique values and attractiveness our Westside communities possess.

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Pending home sales decline in December
According to the National Association of Realtors, pending home sales fell in December, denoting two straight months of declines. All four major U.S. regions posted both month-over-month and year-over-year drops in contract activity.

The Pending Home Sales Index, a forward-looking indicator, created by the NAR, of home sales based on contract signings, fell 3.8% to 117.7 in December. Year-over-year, transactions decreased 6.9%. An index of 100 is equal to the level of contract activity in 2001.

“Pending home sales faded toward the end of 2021, as a diminished housing supply offered consumers very few options,” said Lawrence Yun, NAR’s chief economist. “Mortgage rates have climbed steadily the last several weeks, which unfortunately will ultimately push aside marginal buyers.” Even with December’s slowdown in transactions, Yun says last year was an overall great period for housing in terms of sales and price appreciation.

“The market will likely endure a minor reduction in sales as mortgage rates continue to edge higher,” he added. Yun forecasts the 30-year fixed mortgage rate to jump to 3.9% by the fourth quarter and existing-home sales to dip by 2.8% to 5.95 million units. The index in the West decreased 10.0% in December to 95.0, down 16.2% from a year prior.

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What did we leave behind? Home prices also increased in the U.S.
The fourth quarter of 2021, much like the third quarter, saw home prices continue to increase, although at a slower pace. Fewer markets in the last quarter experienced double-digit price gains.

According to the latest quarterly report from the NAR, out of 183 measured markets, 67% of the metros markets reached double-digit price appreciation compared to 78% in the prior quarter. Nationally, the median single-family existing-home price rose at a slower rate of 14.6% year-over-year to $361,700 compared to the year-over-year pace in the previous quarter (15.9%).

While the third quarter of 2021 witnessed all regions achieve double-digit price gains, the fourth quarter saw only the South experience double-digit price appreciation (17.9%), and single-digit price gains in the Northeast (6.8%), Midwest (8.6%), and the West (7.7%).

“Homebuyers in the last quarter saw little relief as home prices continued to climb, albeit not as fast as earlier in the year,” said Lawrence Yun, NAR chief economist. “The increasing prices are indicative of a seller’s market, with an abundance of eager buyers and very limited supply.”

You can bet those sellers in Nevada, Arizona, Texas, Oregon, Idaho, and even Florida — are waiting for Californians to make their move.

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Moraga Drive — a private enclave away ‘from everything’
There is something so special about Moraga Drive — close to everything, but so far away. This small neighborhood tucked away in the recesses of Sepulveda Pass, you’d never find it by just driving around…it is truly off ’the beaten track’, and that is why it is so special.

Moraga Drive, 90049, is steps away from Getty Museum, freeway close, comprised of 49 one- and two-story homes built since the mid-1950s, many of which have been rebuilt or remodeled.

This is a remarkable, lovely street with a wonderful feeling of “country in the city. Every time I drive down the street, I am reminded of the “allees” in France with all of the tall lovely trees and their branches joining together. No sidewalks, tall trees, and manicured lawns. Moraga Drive is also home to the Westside’s only producing vineyard – world-famous Moraga Vineyards, 17 acres of cabernet, merlot, and chardonnay grapes. And yes, the Vineyards give the area this unique, out-in-the-country feeling that is also expressed in the luxurious homes in this hideaway — an elegant hideaway where your neighbor is one of California’s prestigious wineries. Please contact me if you are thinking of =buying or selling on this very special street… 310 442-1384 or ceschiffer1@gmail.com

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Award

I am very grateful and proud to share with you that I am among the top 7% worldwide of all of the Coldwell Banker agents! Thank you to all of my wonderful clients for their business in “getting me” here! My goal for 2022 is to be in the top 2%. Looking forward to all of you with us working together to get there.

In order to reach my goal, I need your assistance. I have a number of buyers for properties in Bel Air Crest, Mountaingate, Brentwood Circle, Bel Air Park and Brentwood proper. We have seen everything on the market. Please if you are thinking of selling, please get in touch with me. We might be able to get your home sold without putting it on the open market.

HAPPY VALENTINES DAY!. Today is the day to share with your loved ones how much you love and care for them. I hope you all have a wonderful day filled with love, celebration and perhaps some chocolate