When it comes to sales, what is really going on... Observations by...

By
Real Estate Agent with Berkshire Hathaway HomeServices 01238708

When it comes to sales, what is really going on in the Greater Los Angeles and Beverly Hills Real Estate markets? Observations by a Beverly Hills Realtor.

Today I received an email link from one of my concerned client’s. The link was giving the gloom and doom headline along with several cut and pastes taken from the National Association of Realtors (NAR’s) statistics to substantiate the message. See for yourself as I have highlighted the gist of it here:

“Price reductions 29% since last month” and “Sales are down since last month”

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This headline in itself does not put things in proper perspective since pre-Pandemic shutdown these were the standard prices and sales statistics. As a Beverly Hills Realtor, for the past two years I have been joking that the world is coming to an end, but real estate is on FIRE. Why? The answer is simple, lack of inventory with buyers who wanted to move out of crowded urban areas to more suburban places where there was a bit of a distance between their neighbors via and could offer a backyard. Buyers were willing to pay a premium since because of the Pandemic.

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“Annual Foreign Investment in U.S. Existing-Home Sales Climbed 8.5% to $59 Billion, Ending Three-Year Slide” and “International buyers purchased $59 billion worth of U.S. residential properties from April 2021–March 2022, up 8.5% from the previous year and breaking a three-year streak of declines. The 98,600 existing homes sold – the lowest since NAR tracking began in 2009 – were down 7.9% from the previous year. In terms of overall dollar volume, rising foreign buyer purchase prices offset the annual decline in homes sold”

Let’s pay particular attention to the last sentence: In terms of overall dollar volume, rising foreign buyer purchase prices offset the annual decline in homes sold’

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What you need to understand is that foreign investors know this is a good time to buy. Clearly when the local U.S. buyers are wary of making a home purchase due to increased interest rates, inflation and recession as they read in the news media headlines this causes a pause in price increases as well as competition. So the foreign investors are smiling and thanking the news media. While the news media is all about “headlines” without facts or the whole picture to support them, the international buyers do their homework.

Why were purchases of international buyers down in the U.S. for the past two years? One obvious answer was the lockdown that prevented international travelers coming to the United States.

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One of my clients had to wait two years before he could come to Los Angeles. Now he is ready to buy because he understands that whatever he buys he will be able to rent and make a great deal of profit by doing so. He is a cash buyer who can not only buy, but negotiate on the price points since he has little or no competition.

 

www.endrebarath.com

 

 

 

 

Wishing you a safe and healthy life and I look forward to your comments. If you are looking for a knowledgeable, focused and goal-oriented Realtor in the Beverly Hills area who will help you achieve your Real Estate goals, please reach out to me directly! If you are looking for a pet friendly Beverly Hills Realtor who can handle and sell the most difficult properties that no one else could, please reach out to me directly!! If you are considering buying or selling a home, a luxury home, luxury investment real estate, luxury vacation homes, or luxury beach properties in Southern California, Los Angeles, Century City, Westwood, West Hollywood, Beverly Hills, Marina Del Rey, Venice or Malibu, feel free to contact me at 310.486.1002 ( m) homes@endrebarath.com or visit one of my websites at https://www.endrebarath.com I contribute a portion of my commission to local animal rescue organizations. Endre Barath, Jr. Realtor at Berkshire Hathaway HomeServices California Properties DRE#01238708 

Comments (47)

Philip A. Raices
Turn Key Real Estate - Great Neck, NY
1 of the Most Knowledgeable Brokers on the Net!

Hey Endre, I see how the western markets have obviously changed and a lot is due to interest rates, but then the psychology takes hold and spreads like fire!  Long Island hasn't seen the change yet from a seller's market to a buyer's market as our inventory hasn't change markedly and so I believe that prices will hold and not decrease a lot due to this fact.  However, coops that are somewhat mostly indigenous to NY has seen a bit of a slowdown as well as condos, although they are more of an investment vehicle than co-ops.  As the negative psychology really takes hold then the high end of the market will have its issues as those with the cash will step back as some are currently doing and come back in when they feel a deal can be made.  The exception to the rule of Ray Dalio, Bridgewater Associates that "cash is trash" will be in the real estate market, when  cash will make the best deals over the next few years.

Jul 23, 2022 08:17 AM
Endre Barath, Jr.
Berkshire Hathaway HomeServices - Beverly Hills, CA
Realtor - Los Angeles Home Sales 310.486.1002

Jeff Masich-Scottsdale AZ Associate Broker,MBA,GRI  I have focused on two niche markets one was International Buyers and Sellers and the other has been vacant land, hence when the market changes in either direction I am well balanced to continue my business, Endre

Jul 23, 2022 02:58 PM
Endre Barath, Jr.
Berkshire Hathaway HomeServices - Beverly Hills, CA
Realtor - Los Angeles Home Sales 310.486.1002

Nina Hollander, Broker  well said, local markets are like Wineries some are faring better than others and can not pile them into simple wine sales with the Camus of this world and the Two buck Chucks:)Endre

Jul 23, 2022 03:00 PM
Endre Barath, Jr.
Berkshire Hathaway HomeServices - Beverly Hills, CA
Realtor - Los Angeles Home Sales 310.486.1002

Brian England  your comment proves why Realtors were not replaced by the Z's & T's of this world, because we provide local insight that they can not. Endre

Jul 23, 2022 03:01 PM
Endre Barath, Jr.
Berkshire Hathaway HomeServices - Beverly Hills, CA
Realtor - Los Angeles Home Sales 310.486.1002

Kat Palmiotti  one of my Canadian Sellers had to go to the border and meet the Traveling Notary to sign the Grant Deed since it was faster than making an appointment with the US Embassy in Canada:)Endre

Jul 23, 2022 03:06 PM
Endre Barath, Jr.
Berkshire Hathaway HomeServices - Beverly Hills, CA
Realtor - Los Angeles Home Sales 310.486.1002

Grant Schneider  you are absolutely right, Endre

Jul 23, 2022 03:07 PM
Endre Barath, Jr.
Berkshire Hathaway HomeServices - Beverly Hills, CA
Realtor - Los Angeles Home Sales 310.486.1002

Wanda Kubat-Nerdin - Wanda Can!  thank you for your thoughtful comment, Endre

Jul 23, 2022 10:37 PM
Endre Barath, Jr.
Berkshire Hathaway HomeServices - Beverly Hills, CA
Realtor - Los Angeles Home Sales 310.486.1002

Lawrence "Larry" & Sheila Agranoff. Cell: 631-805-4400  yes it is in the local details  that the media fails to mention, Endre

Jul 23, 2022 10:38 PM
Endre Barath, Jr.
Berkshire Hathaway HomeServices - Beverly Hills, CA
Realtor - Los Angeles Home Sales 310.486.1002

Beth Atalay  I remember 2007/2008 time frame when the Foreign buyers were smiling and I was helping them.... same situation now, Endre

Jul 23, 2022 10:40 PM
Endre Barath, Jr.
Berkshire Hathaway HomeServices - Beverly Hills, CA
Realtor - Los Angeles Home Sales 310.486.1002

George Souto  reminds me of cooking, every one thinks it is easy:) like Real Estate:))Endre

Jul 23, 2022 10:41 PM
Endre Barath, Jr.
Berkshire Hathaway HomeServices - Beverly Hills, CA
Realtor - Los Angeles Home Sales 310.486.1002

Kris Collis, Associate Broker  your kind words are appreciated, Endre

Jul 23, 2022 10:55 PM
Endre Barath, Jr.
Berkshire Hathaway HomeServices - Beverly Hills, CA
Realtor - Los Angeles Home Sales 310.486.1002

Michael Jacobs  what is the old saying the Devil is in the Details? Endre

Jul 23, 2022 10:56 PM
Endre Barath, Jr.
Berkshire Hathaway HomeServices - Beverly Hills, CA
Realtor - Los Angeles Home Sales 310.486.1002

Hannah Williams  and I thought I was clarifying the misinformation on the News Media's headlines:)Endre

Jul 23, 2022 10:57 PM
Endre Barath, Jr.
Berkshire Hathaway HomeServices - Beverly Hills, CA
Realtor - Los Angeles Home Sales 310.486.1002

Edward Gilmartin  I remember much higher interest rates.... on a side note what part of Boston do you service? I used to sell in the Back Bay, South End, and Beacon Hill to name a few, that was of course 25+ years ago, Endre

Jul 23, 2022 10:59 PM
Edward Gilmartin

Beacon Hill

Jul 26, 2022 07:51 AM
Endre Barath, Jr.
Berkshire Hathaway HomeServices - Beverly Hills, CA
Realtor - Los Angeles Home Sales 310.486.1002

Gary J. Muccio, Associate Broker  Yes I  enjoy watching other parts of the country's Market Activity... over the past 27 years I noticed what ever happens in Los Angeles it is followed in the rest of the country by about six months or so later, Endre

Jul 23, 2022 11:00 PM
Endre Barath, Jr.
Berkshire Hathaway HomeServices - Beverly Hills, CA
Realtor - Los Angeles Home Sales 310.486.1002

Philip A. Raices  loved your comment more eloquent than what I am always stating... "herd mentality" when everyone is buying or when no one is buying:)Endre

Jul 23, 2022 11:02 PM
Ray Henson
eXp Realty of California, Inc. (lic. #01878277) - Elk Grove, CA
Realtor

A very interesting view of the market.  Buyers have been asking for options and supply.  They sure have it now, especially here in Elk Grove.  Thank you for sharing your perspective of the market.

Jul 24, 2022 12:06 PM
Ricardo Mello
Manhattan Miami Real Estate - Manhattan, NY
Manhattan & Miami Real Estate Agent

Great post!

Jul 25, 2022 02:41 PM
Endre Barath, Jr.
Berkshire Hathaway HomeServices - Beverly Hills, CA
Realtor - Los Angeles Home Sales 310.486.1002

Ray Henson  my point was that the Headlines are not what you need to focus on rather focus on the local market.... Endre

Jul 25, 2022 11:52 PM
Endre Barath, Jr.
Berkshire Hathaway HomeServices - Beverly Hills, CA
Realtor - Los Angeles Home Sales 310.486.1002

Ricardo Mello  thank you for your comment, how is the Manhattan Market doing? Have not been there in three decades, Endre

Jul 25, 2022 11:53 PM