According to several leading experts, after more than a few disappointing years, we may be looking at a more normal housing market in 2013. The response of housing supply to rising home prices will be crucial. Higher home prices will free up homes that were underwater and could also spark more building.
Los Angeles Time correspondent Alejandro Lazo hosted a Google LA times Hangout to discuss the Southern California housing market with DataQuick analyst Andrew LePage, Zillow.com chief economist Stan Humphries and USC’s Richard Green, director of the Lusk Center for Real Estate.
Stan Humphries: “understanding what is going to happen with negative equity is pretty important because I think it is negative equity that is constraining a lot of for-sale inventory. So with these types of price gains…half of that increase in median sales price is just a mix-shift…enormously robust home price appreciation…is going to free a lot of people from negative equity which is then going to change the supply dynamics and will lead to some moderation in home value moderation. What’s happening with new construction is going to be a big factor.”
Andrew LePage: “less of what’s selling today ….is foreclosured properties and a lot more is the mid to high end property in the move up market in the coastal markets…we’ve had higher demand meet very restricted inventory for sale…”
Richard Green “…the fundamentals are pretty strong here for the housing market for the next year at least.”
Watch the whole discussion here.