Low Rates, Higher Demand
Hello friends and future homeowners. This is Stephen Meade with Domicile Real Estate where we are on a mission to help California's renters become homeowners. This is our Southern California first time buyer market update. I hope everyone had a great Thanksgiving holiday weekend. If you're looking to buy a home, hopefully you did not spend too much money. on Black Friday. I did some interesting developments. The last couple of weeks, we've really seen the rates come back down a bit. I think that is a welcome relief for a lot of first time buyers. And I will tell you, something I've been saying every year in November, December that is, this is my favorite time of year for homebuyers, because I think you have really kind of you, you're looking at homes with sellers who need to sell, and you're facing the least competition that you're gonna face all year long. So kind of a bit of a little bit of an opportunity for people we've had some clients kind of reach out to us they want to go look at properties. Why? Because they know this is a good time.
By the way, speaking of which, short commercial time, shameless plug, we love doing these market updates, if you are in the Southern California area, and you would like to tap in to our knowledge and expertise, we would love it to represent you and help you buy your first home. Or if there is someone in your life, a colleague, a sibling, a cousin, a friend, somebody you know, should be buying a home, but they are looking to take that first step and they don't know how we would love to chat with them. That is what we specialize in. Let's go ahead and get started. With our market update. We're gonna kind of go through our slides here.
So you know, the first thing that we're looking at is where are we at Price wise, right. And I think what's interesting is kind of looking across that condo spectrum. I know last week, when we chatted, one of the things that we talked about was that the condo market seemed unusually strong. You know, it kind of had home prices. You know, this is a common sort of misnomer about real estate. A lot of people think that home prices just kind of do this in a straight line. But you look as there's kind of fits and starts little jumps and things. And that's because this market is not nearly as smooth as people would like to believe it is. So if you look at our prices, where we're kind of kind of hanging out in the 770 to 780 kind of zone really here for the most part, I think we're seeing some pretty strong demand just because the rates have come down and that has brought the buyers back. Like I said, though, if you're a buyer, it's a great time of year for this to happen. Because if this rate drop happened in March, it would be Armageddon for buyers bidding wars all over the place, you name it, but because it's happening in November, December, I think it's a better situation.
For a lot of those buyers out there who are willing to kind of, you know, maybe push the plate of holiday cookies aside, and be serious about finding the right home for them. If you look here on our entry level condo that's a little bit softer. We saw we peaked, then we came back down a little bit, but still really, you know, this is a bit of a pretty strong year for condos. I think typically in years where you have maybe where demand is a little bit softer, you actually see condos take the brunt of that. And that really hasn't happened this year. Kind of interesting. I know I've talked about this before, that really kind of some of this conventional wisdom may not necessarily be the wisdom of the day anymore. If we look here at our total monthly payment, right, so this is based on 5% down and includes mortgage insurance, taxes, HOA fee, in the case of our entry level condo, and just as a reminder, everyone what is our entry level single family home? Well, that is a three bedroom two bath in Los Angeles and Orange counties. And it is a 25th percentile house.
That means it's not the median, but it's halfway between the bottom and the median. I think that's a good approximation of entry level. And it's kind of that same designation for condos accepted as a two bedroom two bath. So what is the payment if you've got 5% down? Well, it's $6,436 all in on our entry level single family home and $4,990 fear on our entry level condo you see these numbers have come down despite the fact that prices have not why is that interest rates? And if we look at our income required here, I think that's kind of always an interesting chart is what is that minimum household income that is required if you'd like to buy on his part is what does it take to qualify for those payments?
Well, if you have no other debts, you are at $157,616 for our household income for that entry level, single family home and $122,207 for our entry level condos. So what does that mean? That means a household, for example, where one person was making $70,000 a year and another person was making 60, they would be able to qualify for that entry level condo. Now, if we look at our absorption rate, understand this was a little bit of a holiday week, which is always kind of a bizarre item, we tend to see, the buyers still want to make deals, but new homes are not coming in on the market. So that does skew this a little bit.
But gosh, look what happened to that entry level single family home. Almost as many homes came on the market went came on the market went off the market. And we even saw some gains here in our Angelova condo up to an absorption rate of 73%. That is competitive. 97% is a hyper competitive market. But again, remember, holiday week was included in here. So bear that in mind. If we look at our total inventory, I think this one is interesting, too. We see on enchiladas single family home, that inventory is heading in a downward direction, perfectly normal for this time of year if you look back a year ago, but what is not normal is the number of homes which we see is significantly down versus last year. Same thing here with our condos, though a much more gentle curve that we're seeing there.
Now if we look at our 14 day still active percentage, this is a another measure of market competitiveness. So if the absorption rate is kind of our quick and dirty, what came on what went off. This one is a little bit more interesting. This says of the things that came on the market in the last 14 days. What percentage of those are still on the market today. And when this number starts to go down, that indicates a more competitive market we saw is very competitive through the summer, it got a little less competitive. And now it's kind of hovering in this range over here. If we look at our week's supply of homes, this was the one that actually maybe surprised me a little bit is actually thought our condo market was looking pretty strong this year. But we see that relative inventory number shoot up to 13 weeks.
What does this tell me, it tells me if you are a condo shopper, now is the time to be in the market for a condo. I think this means this market is at a relatively high point in terms of relative inventory. We look at our single family home market, though, that number has dropped down to just over seven weeks of inventory. That is certainly better than it has been all summer. But it is quite a bit less than it was at this time last year, we didn't see those seven numbers until we kind of crossed into the end of January, I think we're going to see these numbers kind of continue to sort of go down here. And we're going to be back in a spring with about five weeks of inventory is my guess. So kind of some interesting things going on. Right.
And if we go off share here. Another piece of news that just came out today is the Fannie Mae and Freddie Mac conforming loan limits. As you know, here in California, we are in what's called a high cost or high balanced market. That means we are eligible for bigger balances. So as of right now, lenders are beginning to underwrite loans, where you can put 5% down and buy at a price of over $1.2 million. So that is over $1.2 million with 5% down available on conventional financing. And as these rates come down a little bit, that suddenly becomes much more of an attractive number, especially if your credit is great, because if your credit is great, you're going to get great deals on that mortgage insurance. Mortgage Insurance is significantly less expensive, the better your credit score is.
Anyhow, thank you so much for watching. Definitely don't forget to LIKE subscribe, hit that notification bell. And of course, if you were someone you know should be a homeowner and you're afraid to take that first step that is what we're here to do is help you take that step and get to your destination, which is to become one of California's homeowners and own a piece of California and not just be a renter, don't hesitate to reach out. Thanks so much for watching. We will see you again real soon.