# California's real estate market can positively affect the home theater market



## keithlock (Feb 5, 2013)

There is a real estate boom in Southern California that is seeing higher number of homes selling faster, and at higher prices, than many other exciting growths in that sector from the past.

And if history serves as an indicator of the trend to follow, it means, of course, that new home owners tend to purchase new "stuff" for their new homes and that includes the latest in audio and video equipment.








At the end of last year, more than half of the higher priced homes in Pacific Palisades had multiple offers. In general, in this area of Los Angeles, there is about 8 months worth of home inventory on the market, whereas now there is a record low of 2.2 months of inventory.

Low supply, coupled with low rates, and other factors is driving this surge in demand for real estate.

It's not just the Palisades either. Koreatown, Downtown L.A., Compton, and other areas are also "booming in sales."

Jerry Del Colliano from Home Theater Review believes that "the home theater business is poised for a comeback," because of the real estate boom, that will likely hit Las Vegas, Phoenix, Detroit, etc. as well.

At least one commenter disagrees with this theory, but to me it's an almost obvious notion. Naturally people buy new things for new homes. And many home buyers are just leaving the nest and need the standard stuff.

Also, people generally won't want to place an old tube TV in a newly furnished home if that's all they have. People like new things. It's basic psychology.

*Home purchase upsells*

When considering a home for purchase recently, the home inspector gave me what was essentially a "coupon book," mashed together with the general maintenance guides he put together for me.

And, there were "deals" that he lined up "just for me" for insurance, maintenance, sheds, tankless water heaters, other indoor/outdoor stuff, other services, and you guessed it... home theater equipment. Clearly, the home inspection company picked up on what new homeowners purchase during the exciting build up before the closing date. And they established relationships with other providers for commissions or other perks.

They also took advantage of scarcity, because the deals were set to disappear after x amount of days.

I would have expected the book from my agent, but the inspector was the clever one in this case.

Products needed by many a new homer that can fall under the "home theater" umbrella include: energy-efficient HDTVs, network media systems, remotes, apps, lighting control, shades, high-speed Internet, set-top boxes, subwoofers, speakers, AV receivers, outdoor AV, and the list goes on.

More than the equipment, Del Colliano suggests that this may also end up in the "resurgence for the custom-installation business." Sure, the stuff can be purchased from Costco, Walmart, Amazon, and the like, but it's not their "niche" in terms of service.

"If my prediction turns out to come true, this is very good news for the enthusiast or specialty AV business. Money to invest in new products and technologies will be easier to justify. Consumers will get better product demonstrations. Systems will be more integrated and converged with today's IT elements that are so key to enjoying music, movies, media and more," said Del Colliano in closing.


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## tripplej (Oct 23, 2011)

If the home market picks up then of course all the businesses that depend on the home industry will pick up. Sounds to reason that if you have space to accomodate a home theater and you don't already have the equipment, the AV speciality stores will get more traffic. Let's only hope!


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## fitzwaddle (Aug 25, 2010)

The market does seem to be heating up - I live in So Cal - I have several friends who are looking for a house, and getting outbid by all cash offers.


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## tripplej (Oct 23, 2011)

fitzwaddle said:


> getting outbid by all cash offers.


That is the way to do it.

A lot of folks at my company got relocated to Texas from California and they all bought their houses here all cash - full payment. No house debt!


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## Infrasonic (Sep 28, 2010)

Yup I've been looking for a house for months and there are bidding wars for even not so great properties due to the lack of inventory. It's not fun!!


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## ticopowell (Jan 3, 2013)

Just bought our house near sacramento, we were lucky to pay asking price, but it is a brand new house . The average house in our price range was sold in less than a week. The others were houses that were forclosures or so that they are still for sale. 
But... contrary to the article I haven't bought any new equipment... yet! :neener: send me that coupon book and I might though


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## fitzwaddle (Aug 25, 2010)

Feels like another bubble coming


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## fschris (Oct 31, 2009)

not sure where people are getting all this money... i work for a very big company and they have been super super cheap with raises even though 'world record earnings' 'highest stock price' in a long time.. i have even had 2 promotions in the last 4 years. it was pathetic. more stress, more work, marginal raise.


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## tripplej (Oct 23, 2011)

fschris said:


> not sure where people are getting all this money...


I read an article (see link here) that a lot of folks from China with money are buying land/houses here in the U.S. They see the lower prices here when compared to homes in China and think it is a good economic investment.


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