Open house visitors in Laguna Beach are consistently curious about the current state of our real estate market.
Most buyers are armed with a wealth of general real estate information that has very little relevance locally. The coastline areas tend to be just local in their property values and Laguna Beach in particular has no real tract. The custom homes on the hillside, coupled with the charming village homes and the limited number of ocean front homes, as well as the South Laguna cottages and hillside homes make this an architecturally and socially diverse place to live.
My observations regarding the current market may be summed up with the reality that the last four months have seen quite a market upsurge. The buyer’s market of last year is only evident in your rearview mirrors and the sellers are quite often negotiating multiple offers.
What are the factors that are contributing to the current upswing? There does not appear to be one factor but a variety of influences currently in play:
The low inventory coupled with low mortgage rates and some loosening of the requirements for jumbo loans has contributed to increased buyer demand. Another factor appears to be the resurgence in the number of all cash buyers as well as investor interest. There are a number of buyers who have simply missed the market in their desired price range because they sat on the fence for a little too long.
The other interesting factor is that a number of “underwater” homeowners are moving into the equity seller position with the increase in property values.
Coastal real estate, particularly in Laguna Beach, is a unique market for a variety of reasons. The primary one has to do with the diverse topography and limited land availability. The building codes are quite strict to ensure the stability of the property as well as view preservation. We are a city that has no room for expansion with our preserved open spaces and wilderness areas and what a great place to live for those reasons!
The reality is that a finite commodity coupled with one of the world’s most beautiful coastlines attracts numerous buyers and provides homeowners with very solid long term investments.
The property values contribute to the pride of ownership as well as to the high level of community involvement. The identification as a small town with a large art presence adds to the overall charm of this seaside village. The schools are all award-winning and the superior faculties as well as the quality of parental and community interest make this town a very attractive living opportunity.
Predicting the long term future is much more difficult but based on the current trends of low inventory, desirability of the area, a 45% increase in the median price from January of 2012 and a dramatic decrease in days on the market, we should be looking at a steadily improving market. We are entering into our peak selling time and it will interesting to follow how the next few months unfold.
Cheri Romig, Sales Associate
Coldwell Banker Previews International. Cell: 949-422-4829, Office: 949-499-8767
