With 2019 about to come to an end, here’s a snapshot of Long Beach market trends this year so far, as well as a glimpse into what the coming year might bring. Get tips for buying a house in Long Beach, CA and find out how to invest in commercial real estate successfully in this magnificent South California city.
Market trends for 2019
Long Beach residential real estate prices increased in the past year, making it a great place to invest in real estate. Median home sales price went up by 11%, with no signs of cooling or slowing down, according to real estate site Trulia.
This trend is expected to continue for the remainder of 2019, not just in Long Beach, but in other California cities as well.
Median home sales prices also reflect Zillow‘s real estate predictions for Long Beach in 2019, which state that home prices and property values will increase.
The real estate website based its predictions on the 3.6% increase in Long Beach property values in 2018. Zillow believes that values will increase by 3.3% this year.
However, Long Beach continues to offer more value for money than other waterfront cities in SoCal. Buyers can get more square footage in the city for less than they would comparable properties in the rest of the region.
The residential real estate market is quite diverse, with a mix of single-family homes and condos to choose from.
Mashvisor also found that Long Beach is an amazing market for long-term rentals. Top performing neighborhoods for long-term rentals include North West Long Beach, Birby Knolls, and East Side, with traditional rental income ranging from $2,958 to as much as $5,044. Birby Knolls has a traditional cash-on-cash return of 2.7%.
Long Beach commercial real estate in 2019
As for commercial real estate, 2019 saw some high profile deals in Long Beach, including the $2.03 million sale of a 10-unit apartment building in Wrigley, one of the most established neighborhoods in the city.
There are several multi-family developments in the pipeline in downtown, which is expected to generate an uptick in demand and density within the coming six to 24 months. These developments are expected to contribute to the success of local businesses like shops and restaurants in the downtown area.
The market for commercial space, particularly retail, in both downtown and suburban Long Beach locations was expected to remain steady, with no discernable shifts, for the duration of 2019.
A June 2019 report released by CoStar pegged the vacancy rate of retail spaces in Downtown Long Beach at 5.7%, and in suburban areas, at 5.1%.
There retail vacancies were most notcieable in Belmont Shore, along East 2nd Street, where seven to 10 units encompassing 2,000 square feet were still available. These vacancies present an opportunity to entrepreneurs looking to house their businesses in the area.
Predictions for 2020
Real estate experts believe that the California housing market will cool down in 2020 despite a strong economy and robust job market. This will likely put a damper on new construction that can ease the housing shortage in some parts of the state.
Director of University of Southern California Lusk Center for Real Estate Richard Green predicted earlier this year that SoCal real estate prices will decrease from 5% to 10% in 2020 and 2021.
However, since the Federal Reserve has sent signals that it will not be increasing rates further in 2019, Green believes that the decline in home prices over the next two years won’t be as sharp as he initially predicted, noting that the market might see a price drop of 0% to a 5% instead.
With the housing market softening over the coming year, 2020 might be a good time to buy a home in Long Beach, CA.
Why Long Beach, CA?
This coastal city is one of Golden State’s best-kept secrets. Not as crowded as the state’s more popular, trend-conscious beach towns, but just as beautiful, Long Beach draws you in with its laid-back small town feel.
Enjoy the quintessential California lifestyle in this free-spirited SoCal city. The quality of life continues to attract some of the most discerning homebuyers. And despite its desirability, the city has managed to retain its character and peacefulness.
Life in Long Beach revolves around the Waterfront Scene – the city’s most prized attractions can be accessed here, including the Aquarium of the Pacific, which is home to 11,000 aquatic species, including sharks and stingrays; The Queen Mary Hotel; a historic art deco establishment with finely appointed suites; Catalina Island, an exotic getaway with a Mediterranean vibe; and more.
Those who want to venture out will also find Long Beach’s central location convenient – it’s a great jump-off point for California road trips to Los Angeles City, Santa Monica, and Anaheim.
Travelers can skip the mania of LAX and fly out of Long Beach Airport, which is roughly three miles from downtown.
Then there’s the weather – those bright, clear days that lift the spirits and invite you to head out the door and walk around town. SoCal is known for its mild winters and warm ocean waters, making it the perfect place for anybody who loves the great outdoors.
Whether you’re interested in residential, commercial, or investment property, real estate is a dynamic industry. Expect the housing market to ebb and flow. Reach out to me, Michael Thue, today at 562.299.3583, or send me an email at Michael@SoCalTopHomes.com to discuss market trends in Long Beach, CA. You can also reach me here.