Company: LRHC
Filing Date: 2025-04-15
Form Type: 10-K
Source: 0001213900-25-032211
Chunk: 298

Company: La Rosa Holdings Corp.
Filing Date: 2025-04-15
Form: 10-K
Item: Item 1A
Chunk 298
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, condominiums and co-ops, with
a year over year decrease of 1.2% in February 2024 to a seasonally adjusted annual rate of 4.26 million. The slowdown of home sales transactions
resulted from many would-be buyers being priced out of homeownership while many homeowners with mortgage rates below 4.0% feeling stuck
in place, since selling would mean taking on a mortgage with a significantly higher interest rate. This has had an adverse effect on our
agents’ ability to close sales and thus on our results of operations in the year ended December 31, 2024. Thus, we expect these
trends to continue to adversely affect our revenues in 2025. Any further increase in the Fed funds rate could push the U.S. economy into
a recession which is likely to have a further negative effect on our operations, income and financial condition.

20

The housing market is
currently in flux with higher mortgage interest rates and generally increasing home prices which makes it difficult to predict future
market trends. Any decrease in home sales in the future will have an adverse effect on our financial performance and results of operations.

The combination of high mortgage rates, continuing high home prices
and limited inventory slowed the housing market substantially in 2024. Tight inventory was reflected by the rise in the national median
existing home sale price in February 2025 of 3.8% to $398,400 from a year earlier ($384,500). Homes usually go under contract a month
or two before they close, so the February data is based on purchase decisions made in December 2024 and January 2025. The average rate
for a 30-year fixed mortgage was 6.67% as of March 20, 2025, down from 7.22% during the most recent 52 week period, according to Freddie
Mac. This combination of higher mortgage rates and higher sales prices has kept many sellers, who would have to relinquish a mortgage
at 4.0% or less, from selling, and has pushed many prospective buyers, especially first-time home buyers, out of the market. Total housing
inventory at the end of February 2024 was 1.24 million units, up 5.1% from January and up 17.0% from one year ago (1.06 million). There
was an unsold inventory supply of 3.5-months at the current sales pace, equal to January 202