2018 Costa Mesa Real Estate Market Predictions
2018 Costa Mesa Real Estate Predictions – Here we go again! I know you have been patiently waiting to see what I think for the year ahead 🙂 I have to say, looking back on 2017 as I did this week, I was a bit surprised that things have not quite leveled out yet. I really did think this market’s legs would leave by the end of the year. So what’s in store for 2018? Somethings gotta give, right? Here we go:
- Lack of Inventory – Again, the year starts off just like it did last year – not on two feet. Just like the last few years of Costa Mesa housing, starting the year with less than 100 available homes and condos means that prices will jump early in the year, and consequently, there will be bidding wars on the best homes, but that will not last into late summer. I think inventory more than doubles by October of this year.
- Rising Rates – The Fed says they will raise rates three times this year; I think we get all three, if not more. I believe they will raise in quarter basis points this year, though, as opposed to the ⅛th of a point as they had been doing.
- Inventory is UP, UP, UP – I think housing will remain strong the first half of the year, and prices will rise with it. But come Summer (maybe July?), I bet we finally see the inventory bounce up and create better choices for buyers, albeit at higher prices.
- Feel Good Economy – Orange County is one of the brightest spots in the American west for jobs and employment. I fully expect that trend to continue well into 2019 and forward; consequently there should be strong demand for existing and new housing so long as our local economy continues chugging forward.
- New Housing – There was a lot of land or existing buildings purchased in the last three years. Expect to see even more new housing in Costa Mesa this year, but expect the majority of what is released to be priced in the mid $800’s +++.
- Stock Market – I think we will see a very, very healthy and robust stock market for the better part of the year. So long as President Trump doesn’t play around with what’s working too much, the stock market should continue to rise and see new record levels this year.
- Sky High Rents – Rents continue to skyrocket, which should help sales along. Those renters will be forced into buying and finally understanding that buying a home, even with high prices, still makes better sense in a lower interest rate environment if you want to live in Costa Mesa.
- Creative Financing – With prices continuing to push their way up, lenders will be forced to “get creative” and offer new/better programs for buyers to help ease the sticker shock of higher payments. And as I mentioned with rising interest rates in #2, large retail banks (Wells Fargo, B of A, Chase) will be pushing ARM’s, especially in the Jumbo market. I am sure lenders will start trying to bring back stated income loans too! Wouldn’t surprise me.
- Flopped – There are a lot of what I call “Retail Flippers” in the market. Those who buy a run down house at retail prices, put some work and money into fixing it up, then try to flip for a profit. However, they get stuck and realize it is not as easy as it looks on TV. I think this year there will be more than a few “flops” out there in the Costa Mesa real estate market this fall as inventory creeps up and prices need to drop.
- Summer Swoon Becomes A Fall Flop – It can’t go on forever, can it? I think the late summer in late July and August will be a fairly slow period on activity. I really have no idea if this market can go and go and go, as they predict it will. I do think we hit August this year and people in the business start to freak out a bit because inventory starts to rise more than 15%. Then the price drops start happening, and we finally start to see a market correction underway. Most forecasters are predicting another 5% bump up in values, depending on who you read. I think it will be closer to 3% as we have a correcting market in the tail end of the year.. I guess ultimately, if President Trump doesn’t create too many waves in National and International waters, our economic and housing situation should be strong for a good part of the year.
2018 Costa Mesa Real Estate Predictions – connect with local Realtor Colin Delaney @714.743.9882 call/text or via his email.