Driven by the financial assistance programs of late government regulation changes, the Southern California real estate economy is starting to stabilize and find the bottom. Homeowners were granted a $10,000 state tax credit if they are to purchase a property after May 1, 2010. This helped add some incentive to offer more purchasing in an environment that has not witnessed home prices as low as they are currently since 2003. With that credit expiring at the end of last year, 2011 came with stalled activity but now "purchases in process" are at the highest purchasing yet. There has been a glimpse of optimism around the market recently, much of this based on the increase in pending sales. Just recently in the past months the amount of residential and commercial properties that are "pending sale" to a new buyer has increased almost 25%.
There was some loss after the expiration of homebuyers credit, we should see more buyers enter the market due to the recent addition and signing of california based tax programs, yet we know it takes time for those effects to be felt. Poor mortgage rates and unfavorable property sales are advised to endure a rebound in the state's markets.
Residential sales have improved over the last two years, but still have a long and winding road to get through the tough economic environment. Orange County still has to compensate from excessive unemployment, the most critical element in a housing market restoration since unemployed workers don't pass to contract for homes. There is not another place in this country that has experianced so many lossess and financial climax from the foreclosure disaster as the greater Los Angeles area. But an improving trend in home sales with the help of lower priced concerned properties has helped the area. Another round of lower priced foreclosed homes is beginning to hit the market, and that should aid in the Southland's recovery with the statewide tax credit.
In commercial sales we are seeing a small reawakening on the small company side and a lot of refinancing happening with the large industrial sectors. Most of this a two-step of economics and fluctuating day by day, we're not seeing too steady of gains anywhere in particular. The next year should hopefully see big gains in the industrial financial markets but without more increase, southern california will be a bit weak and not opportune for investors too soon.
throughout the rest of this year, we are anticipating to see stability coming into the market with the higher purchase power we are seeing consumers having. This will enable more buyers to enter the market, helping to support home prices and better mortgage rates. By those actions occuring there will be an improving financial structure to supply individuals with more loans, equity, and confidance. This has always shown to be a major contributing factor to spurring on improvements throughout all of our economy, real estate is a major back bone to many business industries. If we see this forecasting come through then it will set the foundations for a better and more economically stable Orange County in 2012.
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