I know you asked this question over a year ago, and the market has certainly seen some amazing things happen since then. Prices on the Palos Verdes Peninsula have dropped in the range of 8% to 15% since last year. Buyers sitting on the sidelines should remember that trying to call the bottom of any market is extremely difficult, If you are buying a home to live in, not a speculative investment, you should be buying for the long term. Todayâ€™s market gives buyers the opportunity to negotiate a great deal. Interest rates are still also at an historical low. For instance, even if prices fell an additional 10%, decreasing the mortgage required to buy a property from $500,000 to $450,000, if interest rates increased from 5.6% to 6.6%, the mortgage payment on the $450,000 mortgage would be the same as the previous $500,000 mortgage. Inflationary pressures continue to increase, due to increases in gas and food prices. With increased inflation, comes higher long term interest rates. The credit crisis may also lead to increased interest rates.
I really believe that now is a great opportunity to negotiate a great deal. We will soon be in the holiday season, when buyers really start to worry about selling their property. Buyers are in the drivers seat in this market, and there is less competition at this time for the really good homes. Prices have also held reasonably steady on the Palos Verdes Peninsula. Prices have decreased in the range of 8% to 15% from last year. This area is highly desireable, and demand to locate here will remain strong. Most of the areas in Southern California which have been hit harder were markets where many more buyers were using no money down variable loans to purchase their properties. This simply did not occur on the Palos Verdes Peninsula. There have been very few foreclosures here, therefore much less pressure to lower prices
If I can be of any help, I would love to hear from you!