Interest rates were all the talk in September. The Fed cut rates and most economists expect 3 more.
Consider => between April 2024 (7.53%) and now (6.15%) the savings for a $1MM loan is $912/month.
Headwinds last 2 years are abating as interest rates peaked last October 2023. Many Buyers have been the sidelines since and the high end of the market is coming back citywide.
In Hancock Park there were 2 sales over $7MM, the highest of which was our 434 S Rimpau which sold within 99.2% of its list price of $9.434MM in 7 days! Proper preparation and pricing continue to be a tried-and-true winning formula in real estate. Local knowledge is nuanced and invaluable to all real and motivated Sellers.
Interesting survey results we heard:
What will is take to free up inventory?
-35% of potential Sellers say rates under 6% (remember many hold rates under 4% now)
-30% say under 5%
What will it take to buy?
-52% of Buyers say rates less than 6%
-47% say under 5%
Uncertainty is always the wild card that impacts sentiment. AND if Buyers wait, they risk is competing with more inventory and more competition. The increase in sales at the high end may instil confidence for those in the sidelines.
We expect a busy 2025!