The Impact of Low Mortgage Rates on the Southern California Housing Market

The housing market in Southern California is experiencing a unique phenomenon as homeowners like Larry Chanes and his wife, Claudia, are opting to stay put rather than sell their homes and move to new locations. The Chaneses, who considered selling their Upland home to move to Murrieta for more space and convenience, ultimately decided against it due to the significant increase in mortgage rates they would face.

The reluctance of homeowners to sell, known as the “seller strike,” has resulted in a decrease in the number of homes for sale, making it challenging for potential buyers to enter the market. This trend has also contributed to a stabilization in home prices, as sellers hold firm and buyers seek slightly better deals relative to previous months.

Experts suggest that the current housing market conditions may continue for some time, as many homeowners have locked in historically low mortgage rates below 3%. While some believe that prices may still decline further, others argue that prices are unlikely to drop significantly unless there is a major economic downturn.

Despite the challenges in the market, some buyers like Arlo and Zach Tysinger are undeterred by high mortgage rates and are still planning to purchase homes, even if it means moving to a different state. Real estate agents are also working to attract more sellers to the market, highlighting the current demand for homes and the potential for sellers to capitalize on the situation.

As the housing market in Southern California continues to navigate these unique circumstances, experts are keeping a close eye on inventory levels and mortgage rates to gauge the future direction of the market. While there may be some relief in sight, the tight market conditions are expected to persist for the foreseeable future.