Newport Beach Real Estate Cycle–What's up for 2012?

Why we live here. Crystal Cove State Beach.

It is important to remember that no matter the economy, our real estate market still follows the same trends on a calendar year.  It just varies in degree of severity.  So, what can we expect for this year?  Here is my guesstimate, based on past annual cycles.

  • January remains sleepy, but phones begin to ring thanks to nice weather and low interest rates.
  • In February people come out after the Super Bowl and more listings come to market.  February 18-19 and 25-26, expect slower weekends with local families away for winter break.
  • March picks up with more active listings, but count on basketball fans to skip the open houses for March Madness.
  • April, May, and June see many good listings in escrow while families strive to move in and get settled over summer.  Many buyers attempt to close with little disruption in the school year, time to make improvements on their new purchase, and get settled and meet the new neighbors before the grind of school starts back up.
  • July and August are slower than you think, with fewer escrows per month than spring.  Summer vacations and good weather lures buyers to the beach, rather than open houses.
  • Early September is slow until after Labor Day and two weeks into school, then we see a spurt of buyer activity through October and into early November.
  • As Thanksgiving approaches, things slow dramatically.  Only serious buyers with more urgency (or serial lookers) will be out and about.  Expect little new action until a week or two after New Years.

Sounds overly simple?  Perhaps, but we seem to follow similar behavior patterns regardless of the Dow Jones or who is in the White House.  Let’s hope for a year of economic growth and general peace with returning prosperity.  It is the Chinese New Year today, after all.  The Year of the Dragon is supposed to be the luckiest!

 

Loan Rates At All Time Lows!

1245 Blue Gum Lane -- IN ESCROW

With home values bottoming out (and in some cases bouncing back), and with interest rates at or near all time lows, I expect to see increased buyer activity in the coming months.  Add those two facts with our typical high volume season of spring into early summer and we have a recipe for a strong first half of 2012.

Our 30-year fixed conforming loans up to $417K are at 3.625%, and jumbos from $625K-$2M are at 4.125%.  Even better, the 10-year fixed to ARMs are at 3.375% and 3.625% for conforming and jumbos, respectively.

The “conforming jumbo” range from $417K to $625K are coming in at 3.875% for a 30-year fixed loan.

Keep your eyes peeled for more homes coming to market in February and March.  If the right one comes along, there has never been a better interest rate climate.  Maybe the wait is over…

*Note:  Mortgage information provided by Tim Sibley at First Capital Mortgage:  949.874.0374.