The national economy is still growing—but it's becoming increasingly clear that growth is no longer happening evenly across every sector.

During the second quarter of 2026, the U.S. economy expanded at a 1.5% annual rate, down from 2.1% during the first quarter. While consumer spending remained surprisingly resilient, supported in part by larger tax refunds, higher borrowing costs and persistent inflation continue to slow housing activity across the country.

For homeowners, buyers, and investors throughout Long Beach, South Los Angeles, Inglewood, Carson, Compton, Torrance, Redondo Beach, Harbor City, Wilmington, San Pedro, and surrounding communities, the current market remains one that rewards preparation and local knowledge—not assumptions.

Let's break down what happened and what it could mean for your next move.

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Economic Growth Slowed—But Consumers Continued Spending

The latest Gross Domestic Product (GDP) report showed the economy growing at 1.5% during the second quarter of 2026.

Although that represents slower growth than earlier this year, several positive trends remained intact:

• Consumer spending accelerated.
• Business investment stayed healthy.
• Equipment and technology investment remained strong.
• Employment continued to support household spending.

However, government spending declined while imports increased, reducing overall GDP growth.

Inflation also remains elevated, particularly as energy prices continue to feel pressure from ongoing geopolitical tensions.

What This Means for Real Estate

A slowing economy does not necessarily mean declining home prices.

Historically, housing is driven far more by:

• Local inventory
• Employment
• Mortgage affordability
• Buyer confidence

Across much of South LA County and Long Beach, inventory remains relatively limited compared with historical norms, helping support home values despite slower national growth.

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The Federal Reserve Held Rates Steady—But Inflation Remains the Story

The Federal Reserve left the federal funds rate unchanged for the fifth consecutive meeting, maintaining its target range between 3.5% and 3.75%.

However, one detail caught economists' attention.

Three regional Federal Reserve presidents voted in favor of raising rates, marking the first time since 2016 that three officials dissented in the same direction.

That tells us one thing:

The battle against inflation isn't over.

Mortgage rates have responded by remaining elevated, with the average 30-year fixed mortgage reaching 6.66%, the highest level in approximately one year.

What This Means for Buyers

Many buyers continue waiting for lower rates.

Unfortunately, waiting comes with trade-offs:

• Less purchasing power if rates stay elevated.
• More competition if rates eventually decline.
• Continued appreciation in many desirable neighborhoods.

For qualified buyers, today's market often offers more negotiating opportunities than the intense bidding wars seen during lower-rate environments.

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Consumer Confidence Continues to Cool

Consumer confidence slipped again during July.

The Consumer Confidence Index fell to 90.8, while expectations for future economic conditions remain below levels historically associated with healthy expansion.

Many households continue expressing concern about:

• Grocery prices
• Inflation
• Energy costs
• Employment outlook

Even though personal finances have improved for some families, many consumers remain cautious about making major financial decisions.

Why This Matters

Housing is often influenced by psychology as much as economics.

When confidence weakens:

• Buyers take longer to make offers.
• Sellers receive fewer impulsive bids.
• Negotiations become more balanced.

This often creates opportunities for prepared buyers and realistic sellers.

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Construction Activity Slowed Again

Construction spending declined slightly during June as higher financing costs continued affecting builders.

Residential construction experienced another month of weakness:

• Single-family construction declined.
• Multifamily development also softened.
• Overall residential investment continued trending lower.

Higher borrowing costs make new developments more expensive, limiting the pace at which new housing inventory enters the market.

Why That's Important Locally

Throughout much of South Los Angeles County and Long Beach, inventory has already been constrained for years.

Slower construction means:

• Fewer new homes entering the market.
• Continued supply shortages.
• Existing homeowners may continue benefiting from limited competition.

Although higher mortgage rates have reduced demand somewhat, limited supply continues helping stabilize prices across many local neighborhoods.

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Rental Demand Continues Improving

The apartment market showed modest strengthening during July.

National median rent increased slightly while vacancy rates remained stable.

Interestingly, several California metros ranked among the nation's fastest-growing rental markets, highlighting continued demand for housing throughout the state.

For local investors, rental demand remains relatively healthy despite broader economic uncertainty.

However, affordability continues to influence tenant behavior, making well-priced rentals and professionally managed properties increasingly attractive.

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What This Means for South LA County & Long Beach

Every neighborhood reacts differently.

Some communities continue experiencing multiple-offer situations.

Others are seeing:

• Longer market times
• Increased price negotiations
• More seller concessions
• Greater opportunities for buyers

That's why national headlines rarely tell the full story.

Whether you're in:

• Long Beach
• South Los Angeles
• Carson
• Compton
• Inglewood
• Torrance
• Redondo Beach
• Harbor City
• Wilmington
• San Pedro

…the best decisions come from understanding your neighborhood's supply, demand, pricing trends, and buyer activity—not national averages.

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Looking Ahead

The remainder of 2026 will likely be shaped by several key factors:

• Inflation trends
• Federal Reserve decisions
• Mortgage rate movement
• Consumer confidence
• Local housing inventory
• Employment conditions

While the economy continues expanding, growth is becoming more uneven. That creates both challenges and opportunities depending on your goals.

For buyers, today's market may offer stronger negotiating power than we've seen in years.

For sellers, pricing correctly and marketing strategically remain critical to maximizing value.

For investors, understanding neighborhood-specific trends is becoming increasingly important as the market shifts from broad appreciation to localized performance.

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Thinking About Buying or Selling?

Every city—and even every neighborhood—has its own story.

If you're wondering:

• What your home is worth today
• Whether now is the right time to sell
• How current mortgage rates affect your buying power
• Which neighborhoods are outperforming the market
• Whether your investment property could generate more value

I'd be happy to help.

Contact me for a personalized market update for your specific city or neighborhood, or if you'd like guidance on whether now is the right time to make your next move. Whether you're buying, selling, investing, or simply planning ahead, having local data can make all the difference.