Fed Keeps Rates Unchanged, New ADU Laws
The Fed kept rates unchanged at their November meeting. While inflation data was mixed, overall it was enough for the Fed to pause rate increases, of key note was their forecast for next year which showed less easing than previously forecast. Mortgage rates went higher last month, close to 8%, but after the Fed announcement mortgage rates dipped by almost half of a percent.
Year over year, S&P Corelogic Case Shiller Index showed that home prices increased 4.5% over a year ago. Meanwhile, the median home price of a single-family home in Los Angeles County has just reached a record high, exceeding $900,000 for the first time. Prices were up 3.7% from August to September, outperforming much of the rest of the state. Extremely low inventory continues to cause upward pressure on the market, despite elevated interest rates. ADU's-there are several items of notes here.
ADU NEWS
A new federal policy allows for the financing of ADU's (Accessory Dwelling Units) when purchasing and allows for using a percentage of the anticipated income, as long as the loan meets federal guidelines and loan limits. More to come on this as there are new California laws that will potentially allow you to sell your ADU. AB 1033 is a new law that takes effect on January 1, it allows the sale of ADU's. The new law is aimed at increasing access to affordable housing by providing more options to buyers. AB 976 will prohibit municipalities from requiring owners to occupy their ADU's, read more here.
Check out the chart below..... the three month rolling period is showing increases for almost all areas. While rates are higher and inventory is slightly higher, it's still not enough to offset buyer demand.
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Single family home prices(median) for August 2023-October 2023:
| Glendale | + 11.2% |
| Burbank | + 5.4% |
| Toluca Lake* | - 36.0% |
| Pasadena | + 5.7% |
| Studio City | - 14.9% |
| Hollywood Hills* | + 28.0% |
| Valley Village | + 9.7% |
| Sherman Oaks | + 3.0% |
| Woodland Hills | + 6.0% |
are somewhat misleading
Weekly national mortgage rates for loans under $400,000, top credit scores:
| 30 yr. fixed rate | 7.57 | ||
| 15 yr. fixed rate | 6.89 | ||
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