BEVERLY HILLS, CA - Prices are up and the sales of existing homes rose to a 6 year high in August. "Prices for homes in the nation's 20 largest cities in June rose 12.1% over the last year, according to a report Tuesday from S&P/ Case-Shiller home price index" (CNN Money). Los Angeles reported the third largest price increase of 19.9% behind only Las Vegas and San Francisco.
Rising mortgage rates are at the forefront of real estate headlines as rates have continued to climb. However, the Federal Reserve's announcement that they will postpone policy changes has resulted in a slight drop in rates which is spurring activity from buyers who want to get in before rates go up again. The Federal Reserve will continue backing the current stimulus plan until there is further evidence that the economic improvement will continue. (USA Today) The LA Times reports that rates have climbed more than one percentage point since early May; but, it is also important to remember that even as rates have begun to climb from this time last year, they are still at historically low levels.
Another driving factor of the current market is historically low inventory which has remained relatively flat on a National level. In our local market, it seems that inventory restrictions may be easing slightly as more sellers are encouraged by rising prices.