JANUARY MARKET + ECONOMIC UPDATE
1/27/2023
Hello Angelinos!
Happy Lunar New Year.
I hope the year is off to a great start for you!
In terms of the market, inventory has picked up this month and more buyers have entered the market as mortgage rates have dropped several weeks in a row, with a slight uptick this week. We are likely at peak interest right now with rates expected to fall later this year.
Moving on from the usual, I wanted to share a new regulation that will have a BIG EFFECT on SoCal homeowners' energy cost.
Net Metering 3.0
On December 15, 2022, the California Public Utilities Commission (CPUC) voted to approve NEM 3.0
NEM 3.0 is a new net metering policy that will ultimately reduce the monthly energy bill savings for new solar owners.
** If you are a Los Angeles DWP customer, you are exempt from NEM 3.0 - lucky you! **
What this means for Los Angeles homeowners:
Under NEM 3.0, customers of PG&E and SCE with solar systems will receive an average of 8 cents per kWh for the excess power they export to the grid. This is roughly 75% less than the average export rate of 30 cents per kWh under NEM 2.0.
New customers will have until April 13, 2023 to be grandfathered into NEM 2.0 by submitting a complete Interconnection Application for a new solar system.
Last year the federal solar tax credit (ITC) was increased to 30% until 2032, meaning solar owners get a credit for 30% of the total cost of the solar system and the cost of roof repair is also applicable for this credit.
NEM 3.0 takeaways:
- Current solar owners will remain under their existing net metering policy
- Californians can be grandfathered into NEM 2.0 by submitting an Interconnection Application for their solar system by April 13, 2023
- Solar owners under NEM 3.0 will earn around 75% less for the excess electricity they produce and export to the grid
With the new 30% federal tax credit, the 2.0 net metering regulations in effect, and newly released highly efficient solar panels available today, it is probably the best time to go solar than at any other time.
If you have any questions about going solar, reach out to me and I'd be happy to point you in the right direction.
All the Best,
Adam
WESTSIDE MARKET STATS:
Message me if you have questions about your specific neighborhood.
NATIONAL 30-YEAR FIXED MORTGAGE RATES GO UP TO 5.92%
The current average 30-year fixed mortgage rate climbed 5 basis points from 5.87% to 5.92% on Friday, Zillow announced.
The 30-year fixed mortgage rate on January 27, 2023 is up 5 basis points from the previous week's average rate of 5.87%.
Additionally, the current national average 15-year fixed mortgage rate increased 4 basis points from 4.91% to 4.95%. The current national average 5-year ARM mortgage rate is up 3 basis points from 5.51% to 5.54%.