In recent weeks, a number of La Jolla homeowners welcomed new residents to their neighborhoods. La Jolla Light recently published a list of home sales in La Jolla since September 1, 2015. The article listed 47 homes purchased in La Jolla over last month with an average sales price of $2,080,947.
If the buyers who purchased La Jolla real estate last month opted to use financing, they were able to take advantage of low interest rates courtesy of the Federal Reserve’s decision to not raise the federal funds rates in September. Whether the federal funds rate will remain at or near zero throughout the end of the year remains to be seen, but there are some indications that it may be increased.
Will these homes be some of the last purchased with the record low interest rate? No one can say for sure, but articles recently published by The New York Times indicate that the Federal Reserve may institute an interest rate increase in the near future. An increase could result from meetings held on October 16th, December 16th or in March of next year. Gradual increases would continue on a course to reach a 2.6 percent benchmark rate by the end of 2017, according to The New York Times.
Gradual interest rate increases, whether they take effect this year or next, will influence the real estate market in La Jolla and across the nation. Buyers should take advantage of current low interest rates if possible, but shouldn’t be dissuaded from making purchases after the rate increase. If the interest rate is increased gradually, this will build in time for buyers to purchase homes before it climbs to 2.6 percent at the end of 2017. With the help of knowledgeable real estate and finance professionals, and strong down payments, buyers can purchase beautiful homes in La Jolla in any market environment.
The bottom line
Interest rates may or may not increase, but La Jolla real estate remains a highly sought-after and valuable purchase in an unparalleled area.