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Looking to buy or sell a home this spring? Here's what to expect

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Looking to buy or sell a home this spring? Here's what to expect

Spring is less than a month away, and with it typically comes a busy time to buy and sell a home in Southern California.

The holidays have passed. The weather is warmer. At least in theory, families should have enough time to find a home, move and settle in before their children start school in the fall.

But during four years of a pandemic-influenced market, seasonality has at times gone by the wayside and home prices have whipsawed up, down, then back up again.

So what should you expect if you are looking to buy or sell a home this spring?

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Borrowing costs

If you are buying a home, prepare to pay a high mortgage interest rate.

Prospective buyers had received some good news in recent months as the average rate on a 30-year fixed mortgage fell from a high of 7.79% at the end of October to 6.6% in January.

Mortgage interest rates tend to follow inflation and during that time inflation showed signs of easing. But in recent weeks, economic reports have signaled inflation may be harder to eradicate than some expected and mortgage rates have resumed their climb.

As of last week, the average rate on a 30-year fixed mortgage was 6.9%, according to Freddie Mac. That means the monthly payment on an $800,000 house is $128 more a month than that bottom in January, but $387 cheaper than the peak in October.

According to the latest forecast from the Mortgage Bankers Assn., buyers shouldn’t expect drastic relief this year. The trade group expects rates to average 6.6% during the second quarter and end the year at 6.1%.

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If you are selling your home, high rates mean you will have fewer people touring your open houses than during the pandemic boom and you may need to rethink what your home is worth.

However, there are buyers out there at today’s higher rates and some houses still receive bidding wars. Wealthy buyers can easier stomach a mortgage rate around 7% and may be able to pay all cash.

“I wouldn’t call it a hot market,” said Tracy Do, a real estate agent who specializes in Northeast L.A. “It’s very tempered.”

Homes for sale

If you are looking for a home, you may wonder where they’ve all gone. However, the experience might be somewhat easier than it’s been.

For the first time since 2021, new listings in January — homes hitting the market for the first time — were up compared with a year earlier in L.A. County, according to Zillow. Similar trends were seen across Southern California.

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Inventory has been extremely tight because many homeowners have decided not to sell, unwilling or unable to give up their 3% and below mortgages.

Orphe Divounguy, a senior economist with Zillow, said he believes that “lock-in” effect is starting to wear off, as more people decide they’d rather get on with their lives and move than keep a low mortgage rate.

But Divounguy and other economists don’t expect a return to normalcy soon, given the depths of the inventory crisis. In part that’s because of the difficulty of building houses in places like California, but also because high mortgage rates will still prohibit some from selling.

According to Zillow, there were a total of 10,887 homes on the market in January in L.A. County, both new listings and homes that remain on the market unsold. That was 13% below a year earlier, but an improvement from the 26% annual decline recorded in September.

Real estate agent Do said she is not seeing a flood of calls from people seeking to list their house.

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Some of the calls she does get come from people asking her to run the numbers to see if it makes more financial sense to lease their house rather than sell it since rents are high and they have sub-3% mortgage rates.

“They are just thinking of keeping it as long-term investment, because they can,” Do said. “They have such a low overhead.”

High prices

If you’re looking for a screaming deal, you’ll be disappointed, according to many economists.

According to Zillow, home prices across the six-county Southern California area dipped slightly in November and December, while they remained largely flat in January.

Part of the reason is high mortgage rates prevented buyers from bidding up the cost of housing. But economists say part of the lack of movement in values is seasonality, since the winter is typically a slow time in the market.

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As buyers return this spring, some experts predict there will be enough of a mismatch between supply and demand to send prices back up.

Overall, Zillow expects home prices in January 2025 to be 4.5% higher than January 2024 in the Inland Empire counties of Riverside and San Bernardino. Across Los Angeles and Orange counties, prices are predicted to climb 2.6%.

However, economists say prices could fall if the Federal Reserve’s actions to beat back inflation push the nation into a recession.

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U.S. Space Force awards $1.6 billion in contracts to South Bay satellite builders

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U.S. Space Force awards .6 billion in contracts to South Bay satellite builders

The U.S. Space Force announced Friday it has awarded satellite contracts with a combined value of about $1.6 billion to Rocket Lab in Long Beach and to the Redondo Beach Space Park campus of Northrop Grumman.

The contracts by the Space Development Agency will fund the construction by each company of 18 satellites for a network in development that will provide warning of advanced threats such as hypersonic missiles.

Northrop Grumman has been awarded contracts for prior phases of the Proliferated Warfighter Space Architecture, a planned network of missile defense and communications satellites in low Earth orbit.

The contract announced Friday is valued at $764 million, and the company is now set to deliver a total of 150 satellites for the network.

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The $805-million contract awarded to Rocket Lab is its largest to date. It had previously been awarded a $515 million contract to deliver 18 communications satellites for the network.

Founded in 2006 in New Zealand, the company builds satellites and provides small-satellite launch services for commercial and government customers with its Electron rocket. It moved to Long Beach in 2020 from Huntington Beach and is developing a larger rocket.

“This is more than just a contract. It’s a resounding affirmation of our evolution from simply a trusted launch provider to a leading vertically integrated space prime contractor,” said Rocket Labs founder and chief executive Peter Beck in online remarks.

The company said it could eventually earn up to $1 billion due to the contract by supplying components to other builders of the satellite network.

Also awarded contracts announced Friday were a Lockheed Martin group in Sunnyvalle, Calif., and L3Harris Technologies of Fort Wayne, Ind. Those contracts for 36 satellites were valued at nearly $2 billion.

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Gurpartap “GP” Sandhoo, acting director of the Space Development Agency, said the contracts awarded “will achieve near-continuous global coverage for missile warning and tracking” in addition to other capabilities.

Northrop Grumman said the missiles are being built to respond to the rise of hypersonic missiles, which maneuver in flight and require infrared tracking and speedy data transmission to protect U.S. troops.

Beck said that the contracts reflects Rocket Labs growth into an “industry disruptor” and growing space prime contractor.

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California-based company recalls thousands of cases of salad dressing over ‘foreign objects’

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California-based company recalls thousands of cases of salad dressing over ‘foreign objects’

A California food manufacturer is recalling thousands of cases of salad dressing distributed to major retailers over potential contamination from “foreign objects.”

The company, Irvine-based Ventura Foods, recalled 3,556 cases of the dressing that could be contaminated by “black plastic planting material” in the granulated onion used, according to an alert issued by the U.S. Food and Drug Administration.

Ventura Foods voluntarily initiated the recall of the product, which was sold at Costco, Publix and several other retailers across 27 states, according to the FDA.

None of the 42 locations where the product was sold were in California.

Ventura Foods said it issued the recall after one of its ingredient suppliers recalled a batch of onion granules that the company had used n some of its dressings.

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“Upon receiving notice of the supplier’s recall, we acted with urgency to remove all potentially impacted product from the marketplace. This includes urging our customers, their distributors and retailers to review their inventory, segregate and stop the further sale and distribution of any products subject to the recall,” said company spokesperson Eniko Bolivar-Murphy in an emailed statement. “The safety of our products is and will always be our top priority.”

The FDA issued its initial recall alert in early November. Costco also alerted customers at that time, noting that customers could return the products to stores for a full refund. The affected products had sell-by dates between Oct. 17 and Nov. 9.

The company recalled the following types of salad dressing:

  • Creamy Poblano Avocado Ranch Dressing and Dip
  • Ventura Caesar Dressing
  • Pepper Mill Regal Caesar Dressing
  • Pepper Mill Creamy Caesar Dressing
  • Caesar Dressing served at Costco Service Deli
  • Caesar Dressing served at Costco Food Court
  • Hidden Valley, Buttermilk Ranch
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They graduated from Stanford. Due to AI, they can’t find a job

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They graduated from Stanford. Due to AI, they can’t find a job

A Stanford software engineering degree used to be a golden ticket. Artificial intelligence has devalued it to bronze, recent graduates say.

The elite students are shocked by the lack of job offers as they finish studies at what is often ranked as the top university in America.

When they were freshmen, ChatGPT hadn’t yet been released upon the world. Today, AI can code better than most humans.

Top tech companies just don’t need as many fresh graduates.

“Stanford computer science graduates are struggling to find entry-level jobs” with the most prominent tech brands, said Jan Liphardt, associate professor of bioengineering at Stanford University. “I think that’s crazy.”

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While the rapidly advancing coding capabilities of generative AI have made experienced engineers more productive, they have also hobbled the job prospects of early-career software engineers.

Stanford students describe a suddenly skewed job market, where just a small slice of graduates — those considered “cracked engineers” who already have thick resumes building products and doing research — are getting the few good jobs, leaving everyone else to fight for scraps.

“There’s definitely a very dreary mood on campus,” said a recent computer science graduate who asked not to be named so they could speak freely. “People [who are] job hunting are very stressed out, and it’s very hard for them to actually secure jobs.”

The shake-up is being felt across California colleges, including UC Berkeley, USC and others. The job search has been even tougher for those with less prestigious degrees.

Eylul Akgul graduated last year with a degree in computer science from Loyola Marymount University. She wasn’t getting offers, so she went home to Turkey and got some experience at a startup. In May, she returned to the U.S., and still, she was “ghosted” by hundreds of employers.

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“The industry for programmers is getting very oversaturated,” Akgul said.

The engineers’ most significant competitor is getting stronger by the day. When ChatGPT launched in 2022, it could only code for 30 seconds at a time. Today’s AI agents can code for hours, and do basic programming faster with fewer mistakes.

Data suggests that even though AI startups like OpenAI and Anthropic are hiring many people, it is not offsetting the decline in hiring elsewhere. Employment for specific groups, such as early-career software developers between the ages of 22 and 25 has declined by nearly 20% from its peak in late 2022, according to a Stanford study.

It wasn’t just software engineers, but also customer service and accounting jobs that were highly exposed to competition from AI. The Stanford study estimated that entry-level hiring for AI-exposed jobs declined 13% relative to less-exposed jobs such as nursing.

In the Los Angeles region, another study estimated that close to 200,000 jobs are exposed. Around 40% of tasks done by call center workers, editors and personal finance experts could be automated and done by AI, according to an AI Exposure Index curated by resume builder MyPerfectResume.

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Many tech startups and titans have not been shy about broadcasting that they are cutting back on hiring plans as AI allows them to do more programming with fewer people.

Anthropic Chief Executive Dario Amodei said that 70% to 90% of the code for some products at his company is written by his company’s AI, called Claude. In May, he predicted that AI’s capabilities will increase until close to 50% of all entry-level white-collar jobs might be wiped out in five years.

A common sentiment from hiring managers is that where they previously needed ten engineers, they now only need “two skilled engineers and one of these LLM-based agents,” which can be just as productive, said Nenad Medvidović, a computer science professor at the University of Southern California.

“We don’t need the junior developers anymore,” said Amr Awadallah, CEO of Vectara, a Palo Alto-based AI startup. “The AI now can code better than the average junior developer that comes out of the best schools out there.”

To be sure, AI is still a long way from causing the extinction of software engineers. As AI handles structured, repetitive tasks, human engineers’ jobs are shifting toward oversight.

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Today’s AIs are powerful but “jagged,” meaning they can excel at certain math problems yet still fail basic logic tests and aren’t consistent. One study found that AI tools made experienced developers 19% slower at work, as they spent more time reviewing code and fixing errors.

Students should focus on learning how to manage and check the work of AI as well as getting experience working with it, said John David N. Dionisio, a computer science professor at LMU.

Stanford students say they are arriving at the job market and finding a split in the road; capable AI engineers can find jobs, but basic, old-school computer science jobs are disappearing.

As they hit this surprise speed bump, some students are lowering their standards and joining companies they wouldn’t have considered before. Some are creating their own startups. A large group of frustrated grads are deciding to continue their studies to beef up their resumes and add more skills needed to compete with AI.

“If you look at the enrollment numbers in the past two years, they’ve skyrocketed for people wanting to do a fifth-year master’s,” the Stanford graduate said. “It’s a whole other year, a whole other cycle to do recruiting. I would say, half of my friends are still on campus doing their fifth-year master’s.”

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After four months of searching, LMU graduate Akgul finally landed a technical lead job at a software consultancy in Los Angeles. At her new job, she uses AI coding tools, but she feels like she has to do the work of three developers.

Universities and students will have to rethink their curricula and majors to ensure that their four years of study prepare them for a world with AI.

“That’s been a dramatic reversal from three years ago, when all of my undergraduate mentees found great jobs at the companies around us,” Stanford’s Liphardt said. “That has changed.”

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