Light at the End of the Tunnel

The Los Angeles housing market is finally showing signs of relief. After years of elevated borrowing costs holding buyers back, mortgage rates have been trending consistently lower this fall. That slow, steady improvement is reshaping affordability in ways many didn’t notice until now—much like how fall weather quietly replaces summer without anyone realizing the shift overnight.

Rates Are Finally Helping, Not Hurting

For the first time in years, mortgage rates have held in a more favorable range for several months. This is the longest stretch of improved affordability we’ve seen since early 2022. It didn’t create an instant surge in demand—but inch by inch, buyers are re-entering the market with more confidence.

The economic backdrop is also different from last year. With the broader U.S. economy cooling instead of accelerating, experts expect rates to remain stable heading into 2026. That stability should align perfectly with next year’s spring market—traditionally the busiest and most competitive season.

Demand Is Still Soft, But Poised to Shift

Buyer activity is still muted compared to pre-2022 levels. High borrowing costs over the past three years kept many would-be buyers on the sidelines, and seasonal distractions around the holidays naturally slow the market even further.

But unlike the last few years, the environment is now improving instead of deteriorating. When the calendar turns and spring arrives, expect buyer interest to finally pull away from the low plateau we’ve been stuck in.

Inventory Is Shrinking—Seasonal and Emotional Factors at Play

Active listings have been trending downward as we move deeper into the holiday season. This happens every year, but the difference today is that many homeowners still hesitate to list because they enjoy low mortgage rates they don’t want to give up.

While more sellers came to market in 2025 compared to the previous two years, the overall pace remains well below normal. The result: buyers will likely enter 2026 with more motivation—but still fewer homes to choose from.

The Luxury Market Is Steady

High-end properties have seen slight improvements too. Luxury inventory has eased as fewer new listings hit the market during the holidays. Demand has held steady, creating a small but meaningful shift toward a healthier balance in this segment.

The Bottom Line

Momentum is quietly building. Rates are more favorable, affordability is improving, and the spring market of 2026 is lining up to be the first “normal-ish” environment we’ve had in years.

The change won’t feel dramatic… until one day it does.

If you’re thinking about buying or selling in 2026, now is the time to plan.
Reach out for a personalized strategy session, I’ll walk you through today’s trends, pricing expectations, and the best timing based on your goals.

Let’s get ahead of the shift before the rest of the market wakes up.