After The LA Fires

AFTER THE FIRES...

The Market has completely changed as we head into Spring 2025. 
Independent of the Fires.
The new mandates regarding Commission "Clear Cooperation Policies" have changed Buyers and Sellers attitudes towards Real Estate transactions. Buyers are now being assigned the responsibility of compensating their agents - if commission is not offered on a particular listing.

Interest Rates are still high. They are still above the "magic" 6% threshold, resulting in high payments and slowing demand.

The economy is.... spiraling? Would that be the best word to describe it? The word recession is once again a buzz word - which never bodes well for the Real Estate market.

Some pockets are now Solid "Buyers" markets, while some areas are still as hot as fish grease for Sellers. Truly depends on the location, price point and School Districts.

Sellers who put their homes on the market "after the fires" hoping to benefit from a huge new community of Buyers needing homes are finding out that if their home is not in a "good school district" - their home is not all that desirable to any of those potential buyers.

Why?
Simple.
Families with school-aged children had a goal to resettle as quickly as possible (For the next couple of years) in a good school district so that their kids could return to their "regularly scheduled lives" as soon as they could. If you did not have school-aged kids and the school district was not an issue for you - then you can take your time.

Those people affected have a multitude of options:
- Lease a home or apartment that is much smaller than the home they lost; move out of area for the time being; At a lower or more affordable monthly payment - especially while they deal with the financial implications of the home they lost
- Move to family member's homes for the short term (outside of Los Angeles). This provides them time for things to settle down, for them to adjust to their new normal and also get to work on rebuilding the homes they lost.
- Move to another area outside of Los Angeles - specifically South Orange County - where the schools are very good and the lifestyle is similar.

Unfortunately for many property Sellers in LA hoping to benefit by listing their homes in the past couple months since the fires - we are seeing many new cancellations of listings - for homes only on the market for 30 days or so. The main reasons being that:
- Interest rates are still high
- Those that lost homes are not necessarily in a financial position to purchase "another home" - when they have lost the equity in the home they lost and they still have a financial responsibility to the outstanding mortgage
- Some people can not even begin to imagine Buying another home right now, when their lives are completely shattered and they are still in a state of shock

Thus, we saw a crush of activity in some areas;
Other areas were quiet like a typical February and March.

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