{"id":10055,"date":"2026-05-28T13:31:30","date_gmt":"2026-05-28T13:31:30","guid":{"rendered":"https:\/\/siliconvalleymovingpost.com\/?p=10055"},"modified":"2026-05-28T13:31:30","modified_gmt":"2026-05-28T13:31:30","slug":"how-powells-fed-whipsawed-southern-california-homebuying","status":"publish","type":"post","link":"https:\/\/siliconvalleymovingpost.com\/?p=10055","title":{"rendered":"How Powell\u2019s Fed whipsawed Southern California homebuying"},"content":{"rendered":"
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Jerome Powell\u2019s days as Federal Reserve boss were akin to a roller coaster ride for Southern California\u2019s housing market.<\/p>\n

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You can\u2019t pin all of housing\u2019s gyrations on the now-departed Fed chairman. Yet his eight years as the head of the nation\u2019s central bank were a tale of two worlds for real estate, which basically doubled a typical Southern California homebuyer\u2019s mortgage payment.<\/p>\n

Powell\u2019s reign began with low mortgage rates that helped boost home prices and sales. Then the pandemic changed everything.<\/p>\n

Initially, there were historically cheaper loans needed to backstop a coronavirus-twisted economy. Next came a high-rate era used to cool an overheated business climate. Pricey financing stunted home sales and appreciation.<\/p>\n

Let my trusty spreadsheet walk you through how local real estate was whipsawed over Powell\u2019s eight years \u2014 splitting his chairmanship into the first four years against the last four.<\/p>\n

2018-22 vs. 2022-26<\/h4>\n

First, note the mortgage rate gyrations under Powell, as measured by Freddie Mac\u2019s 30-year loan benchmark.<\/p>\n

Nearly 5 percentage points separated the month with the lowest rate (2.7% in December 2020) from the month with the highest rate (7.6% in October 2023). Ponder that this mortgage yardstick averaged 3.6% during his first four years compared with 6.5% in his final four years.<\/p>\n

Consider how those rate swings aligned with Southern California homebuying patterns, according to the real estate tracker Attom.<\/p>\n

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Southern Californians bought 694,571 residences during the past four high-rate years. That was a sharp 28% drop from the buying pace of the previous four low-rate years.<\/p>\n

At the same time, price gains dramatically cooled.<\/p>\n

Now, the mortgage rate reversal didn\u2019t create the pricing discounts house hunters wanted. That may be because the number of homes for sale, according to Realtor.com data, was 10% lower over the past four years than in 2018-22.<\/p>\n

Those pricier mortgage rates, at least, cut the rapid appreciation seen during the pandemic era\u2019s cheap-money days.<\/p>\n

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Think about the $810,000 median selling price in March 2026 for Southern California.\u00a0It represented a slim 8% gain during the past four high-rate years.<\/p>\n

That\u2019s quite a chill compared with the 47% gain in the previous four low-rate years.<\/p>\n

Bottom line<\/h4>\n

Next, ponder how surging rates clobbered affordability as home prices failed to tumble, and sales collapsed.<\/p>\n

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Think about the estimated $3,931 monthly house payment for March 2026 that came with buying the median-priced home \u2014 with a 20% down payment at current rates.<\/p>\n

To a Southern California house hunter, perhaps Powell\u2019s legacy is this: A buyer\u2019s house payment jumped 96% over his eight years.<\/p>\n

Meanwhile, Southern California\u2019s average weekly wages, according to one federal index, rose just 39% in that same period.<\/p>\n

Elsewhere<\/h4>\n

This latest housing tumult isn\u2019t just some Southern California weirdness.<\/p>\n

Statewide, sales fell 27% over the last four years vs. 2018-22. Meanwhile, home-price appreciation slowed to only 5% over the last four years from 47% in 2018-22. Why? House payments rose 91% over eight years.<\/p>\n

Nationally, sales fell 19% over the last four years vs. 2018-22, while price gains slowed to 15% from 48% in 2018-22, as payments rose 109%.<\/p>\n

Counting counties<\/h4>\n

Here are the six local counties\u2019 housing markets under Powell, ranked by their sales drop when comparing the last four years with 2018-22:<\/p>\n

\u2013 San Diego: 32% sales dip with a 10% price gain last four years against 49% in 2018-22. The house payment rose 101% over eight years.<\/p>\n

\u2013 Ventura: 32% sales dip, 9% price gain last four years vs. 41% in 2018-22, payment rose 89%.<\/p>\n

\u2013 Riverside:\u00a0 31% sales dip, 4% price gain last four years vs. 61% in 2018-22, payment rose 107%.<\/p>\n

\u2013 San Bernardino: 31% sales dip, 6% price gain last four years vs. 58% in 2018-22, payment rose 106%.<\/p>\n

\u2013 Orange: County\u2019s 29% sales dip, price gain 21% last four years vs. 41% in 2018-22, payment rose 109%.<\/p>\n

\u2013 Los Angeles: 23% sales dip, price gain 7% last four years vs. 43% in 2018-22, payment rose 87%.<\/p>\n

Jonathan Lansner is the business columnist for the Southern California News Group. He can be reached at jlansner@scng.com<\/em><\/p>\n

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