THE LOS ANGELES TIMES:
The Southern California housing market has been on a nearly seven-year tear, with prices in many communities reaching all-time highs.
But now, as mortgage rates rise, the boom appears to be fading. Sales are dropping; inventory is swelling; more sellers are scaling back their ambitious asking prices.
The annals of postwar Southern California real estate history are full of boom-and-bust cycles, with periods of sharp price appreciation that suddenly skid to a halt. Whether those ups and downs offer any guidance — or hope — for today’s homeowners is a subject for debate.
Some of those who study the housing market predict annual price increases will slow. Others think values could dip. But there is general agreement that a meltdown is not in the offing, given a healthy economy and dearth of home building. The current slowdown, said Christopher Thornberg of Beacon Economics, “is a bump in the road.”
Of course, that’s what some said before the last two busts, in the early 1990s and mid- to late 2000s.
First the good news: There is little reason to believe a bubble anything like the one that popped in 2007 has formed or is forming now.