Los Angeles Housing Market Rebalances in July

Los Angeles Housing Market Rebalances in July

Los Angeles Housing Market Rebalances in July Sales of Homes Between $1 Million & $2 Million Have Picked Up Again

July home sales including single-family residences and condominiums in greater central Los Angeles were down by 6 percent from last July, a smaller decline than in the previous two months. Sales of homes priced between $1 million and $2 million trended higher again.

While most of the decline was still driven by fewer sales of homes priced below $1 million, West Southbay, East Valley, and West L.A. drove most of the decrease.

Relatively more-affordable communities — the Eastside and the North Valley — saw increases in sales over last year’s May-through-July period.

Sales of homes priced between $1 million and $2 million picked up again, driven by the East Valley, Silicon Beach, NELA, and Greater Pasadena.

Only West Southbay, Sunset East, West Valley and South of 210, and Downtown L.A. saw a decline in homes priced below $2 million.

The drag on sales priced higher than $3 million was mostly driven by a notable decline in Beverly Hills, followed by the West Valley.

While inventory fell by 9 percent from last July, the rate of decline is getting smaller, suggesting some improvement in overall supply conditions.

The supply improvement was most notable in West L.A. and Brentwood for homes priced over $1 million.

There were overall almost 1,000 fewer homes for sale than last July, with the lowest price-range driving the decline.

Only West L.A. and Brentwood had more inventory in total compared with last year.

The inventory of homes priced above $3 million increased by 93, mostly in the West Valley, Beverly Hills, and West L.A.

Median home prices increased by 7 percent year over year, with an overall year-to-date, an increase of 10 percent.

Slowing median price growth follows double-digit appreciation since the beginning of 2018.

Median price growth has gradually returned to its last three-year average.

Forecasts call for a 5 percent appreciation through 2019.

Mid-City is now a million-dollar neighborhood, with prices jumping by 28 percent from last June to a median of $1,065,000.

Relatively higher median price growth was seen in Foothill Communities, followed by Eastside, West L.A., and Silicon Beach.

Some sellers rethought their pricing strategies.

More price reductions compared with last July were recorded in areas with a larger share of homes priced between $2 million and $3 million: Malibu, Silicon Beach, the Hollywood Hills, and Brentwood.

Also, areas, where buyers are budget-constrained, are seeing an increase in price reductions, including South L.A. and the Eastside.

Buyer fatigue remains for homes priced between $2 million and $3 million, with a continued increase in price reductions.

Absorption rates, however, remain strong, with more absorption of affordable inventory in the Eastside, the North Valley, South L.A., Mid City, and Foothill Communities.

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