As the housing market reaches white-hot levels, many California buyers are finding that they must pay excessively high prices for older, less fashionable home options. Kenny Slaught points out that costs have been steadily rising since 2008, with the common reference Standard & Poor’s Case-Shiller home price index revealing that Los Angeles home prices hit their highest point during April of this year, the peak since October of 2007. Having grown beyond mere recession recovery, Southern California’s larger metropolitan areas are approaching their former peaks. Slaught says the turnaround is because of a number of factors, such as interest rates, job growth and supply and demand. A 30-year, fixed-rate mortgage is hovering around 3.5% or less, nearing 3.31 percent (the record low hit in November 2012) and pushing many toward buying. These enticingly low rates, coupled with strong employment numbers, such as a 2.4% gain in Los Angeles County and a 3.5% rise in Orange County, make it clear just why values have appreciated in an incredibly fast-paced manner. Despite home prices varying considerably statewide, the inflated asking price of higher-end residences outpaces all states other than Hawaii. The steady demand for housing cannot currently be met by the thin supply available, forcing many first-timers to opt for condominium-style units which are both obtainable and selling within a more modest price range.
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