Should You Fear Buying Now in L.A.?

The future of the housing market is unknown in my opinion. 

Prices may go up further driven by low interest rates and buyers determined to take advantage of the rate market or may come down a bit with changes in the economy.  

That said, rates are at historic lows with average 30-year fixed rates in the 3.125% - 3.500% range for owner occupied loans. 

In a market like Los Angeles where housing prices have historically rebounded from any market crashes the main focal point for buyers should be interest rates unless they are thinking of buying and holding for only a short time. 

With intentions to buy and hold for 7-10 years, historically that would be enough time to ride out any market dips and end up on the high side. 

A 30-year fixed mortgage loan at $100k costs a buyer $492 per month at a rate of 4.250% vs at 3.250% it costs $435.

This adds up when you are looking at a $700k loan and you have a $399 per month lower payment. 
My opinion is get in *now* while rates are super low and don’t worry if the prices can potentially come down or not; as long as you plan to hold for 7-10 years, historically you will end up with a more valuable home than you paid (name a time in history when 10 year *prior* a house was more expensive in LA?). 

The rates being as low as they are create the greatest opportunity to buy (in the LA market).

Daniel Gat has been helping fulfill the American Dream since 2005 and can be reached at

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