Rodeo Realty

Below is our report featuring real estate market data for the Los Angeles area for June 2013.

Check out the July 2013 issue of the Rodeo Realty Journal for the latest information on Rodeo Realty and our agents!

Fresh on the market is this 6,458-square-foot home in the gated community of Brentwood Hills. The 5-bedroom estate was designed by award- winning architect James Porter FAIA. The striking contemporary home boasts amazing city, ocean and canyon views.

A contemporary rotunda staircase leads to the formal entertaining spaces including a living room with floor-to-ceiling windows and fireplace. The large eat-in kitchen opens into the family room with access to the outdoors and looks out to beautiful canyon views.

The tranquil master bedroom has a large master bath with large walk-in closet which opens up to a charming terrace. The grounds have been transformed into a modern serene oasis with hiking paths, exceptional views and a complete compost center. Newly installed solar panels have proven efficient in cutting electricity cost. Additional features include a three-car garage, maids quarters and an elevator.

Get the full experience at the property website and contact Ben Salem of Rodeo Realty for more information.

Real estate news for the month of June centered around higher interest rates after the  Federal Reserve Chairman, Ben Bernanke,  announced that the Fed would be slowing down the mortgage-and-bond buying purchases under the program known as QE3 by the end of the year. He further stated that the Fed planned to end all purchases as early as mid-2015. The reason for this announcement was because the Fed now felt that the economy was growing at a strong pace, unemployment levels have dropped and he expected them to continue to drop, so further stimulus would no longer be needed. This program helped bring rates to the lowest level seen in decades. 

Mortgage interest rates were up sharply for the month. A 30-year-fixed conforming mortgage is now at 4.38% up from 4.24% last week and climbing steadily from 3.75% a month ago. The rate was 3.57% on May 1, so rates are up almost a full percent in 60 days.  A 15-year-fixed mortgage rate is now up to 3.46% up from 3.31% last week and up over half a point from 2.90% last month. Rates on high balance conforming $417,000 – $625,500 ( LA and Orange county and $598,000 for Ventura county) are about 1/8% higher than conforming and jumbo loans are about ½% higher. This week Federal Reserve officials continued efforts to curb a rise in long-term interest rates, hoping to calm fears raised by comments made by Chairman Ben Bernanke that triggered turmoil in global financial markets. Officials say an increase in the Fed’s benchmark interest rate is still a way off and bond purchases could also be prolonged if the economic performance doesn’t measure up to forecasts.

Reports on home prices continue to beat expectations. The California Association of Realtors reported that the median housing price in California increased 31.9% in May, the largest year-over-year increase in 33 years. Inventory levels remain low while the number of sales in May continue to rise. In May, there was a 2.6 month supply listings at the current sales rate, down from 3.6 % a year ago. A six-to-seven-month inventory represents a balanced market.  DataQuick reported that an estimated 42,293 new and resale houses and condos sold statewide last month. That was up 8.3 % from 39,051 in April, and up 1.2 %  from 41,790 sales in May 2012. The sales count was the second highest May ever reported behind only May 2006, where 54,099 homes were sold. We are seeing the strong market continue to get stronger and it seems rising interest rates are making a red hot market even hotter as buyers rush to make deals before interest rates get too high.

The Dow finished out June at 14910 down 2.5% overall from May but up 19.22% over last year. The Dow began the week at 14672 and finished up 1.76 % for the week. The NASDAQ closed at 3403 up 2.52% from last week’s close of 3319. The NASDAQ was down 2.49% from May but up 19.38% year over year. The S&P 500 ended the week at 1606,  up .87% for the week while down 3.24% from May and up a strong 20.86% year over year. Recent volatility seems to have decreased as investors have come to terms with the fact that the Federal Reserve’s stimulus program will eventually come to an end. Friday’s trading session saw some profit taking after a series of rallies over the last three days had sent the Dow back up over 15,000 once again as of Thursday’s close.

In May U.S. employers added 175,000 jobs, a slight improvement over April with the unemployment rate at 7.6%. The state’s employers added 10,800 employees to their payrolls in May, according to figures from the state Employment Development Department. Nearly all industries added workers, led by the leisure and hospitality sector, which added 9,000 jobs, mainly at hotels and restaurants. The California jobless rate plunged to 8.6% in May, down from 9% in April. Reports for June will be out on July 5, but are expected to show further gains in employment.

In other economic news, The Consumer sentiment Reuters / University of Michigan index showed consumer confidence at a 6 year high. Consumer spending was also up. Inflation remained at very low.  Gold, commodities and oil prices all continued to fall on the news that inflation remains in check. Gold, a popular safe spot for investors continues to fall dipping to under $1200 this week, a continued slide for the precious metal which hit a $1,895 an ounce in 2011. It was thought that the Fed’s stimulus programs would add so much money to the money supply that inflation would spike. Gold was sold as a “hedge” against inflation. Unfortunately, for gold buyers, that inflation has not materialized.