The Southern California Homebuying Crisis: A Look at the Numbers
Southern California Homebuying Rebounds from Historic Crash
The past two years have been a challenging time for Southern California homebuyers, with soaring mortgage rates and stubbornly high home prices making it nearly impossible for many to enter the housing market. However, recent data suggests that there may be some light at the end of the tunnel.
According to a recent analysis of CoreLogic sales stats dating back to 1988, the region saw the slowest two-year span of homebuying on record, with only 384,515 residences sold between 2022 and 2023. This historic low in sales was driven by a combination of factors, including record-setting rate hikes by the Federal Reserve and shrinking affordability for potential buyers.
Despite the challenges, there are signs of improvement on the horizon. Mortgage rates are expected to drop in 2024, providing some relief to buyers who have been struggling with high borrowing costs. Additionally, home prices have remained relatively stable, with modest increases seen in 2022-23 after a period of rapid appreciation in previous years.
While the housing market is showing some signs of recovery, affordability remains a major concern for many Southern Californians. Only 17% of residents could qualify to buy the median-priced home in the year ending in September, down from 27% two years earlier. This has led to a significant decline in homebuying activity, with sales plummeting by 43% between 2021 and 2023.
Despite these challenges, there is hope that the Southern California housing market will rebound from its recent crash. With mortgage rates expected to decrease and home prices stabilizing, there may be opportunities for buyers to re-enter the market and find their dream home. As the region continues to navigate these uncertain times, it will be important for both buyers and sellers to stay informed and prepared for any changes that may come their way.