Southern California Home Sales – “For the better part of this year, investors have been slowly trickling out of the home buying market, but in August they apparently cut off the cash flow in a big way.”
Southern California Home Sales:
Investor Activity Slows
Slower Market Activity As Investors Stand Aside
Yesterday we reported here that Southern California Real Estate Values were still growing, but are now growing at a much slower rate than we’ve seen recently. This is actually good news as it makes for a more stable, less volatile market.
Several factors have contributed to this slowdown of rising prices, but the most obvious of those is probably the fact that investor buyers have begun to stand aside somewhat. Here in the San Gabriel Valley, for instance, the market has been driven recently by investors … particularly international buyers from China … looking for overseas real estate investments and finding a spot they like here in Southern California.
Investor activity nationwide has slowed dramatically over the last month or so. However, the pullback by these buyers is not limited to individual international investors, but involves corporate buyers as well.
Here’s an informative article by Diana Olick, from CNBC :
“Just 12 percent of August purchases were by individual investors, down from 16 percent in August (of last year); investors had been making up nearly one-third of home purchases during the worst of the housing crash nationally, and in some markets they accounted for well more than half.”. …
Read More Here: http://www.cnbc.com/id/102021503
Will Traditional Buyers Now Step In?
What we’d like to see happen here is that the slowdown of investor activity would leave some “space” in the market that might be filled by first-time buyers and those looking to move up. But, there are many factors at play here and a variety of influences that contribute to the decisions of traditional home buyers when they consider entering the market. Only time will tell if these folks are ready to jump into the game.