Summer Slowdown Continues

The Los Angeles County housing market entered "The Lull Phase," a period where inventory continues to grow while buyer demand softens, resulting in longer selling times across nearly every price point.

Although headlines may suggest the market is struggling, the reality is much more nuanced. Well-priced homes continue to sell, while overpriced listings are sitting longer than many sellers expected.

Inventory Continues to Rise

The number of active listings increased to 15,021 homes, the highest level since last summer.

Compared with just two weeks ago:

• Inventory increased 4%
• Demand decreased 7%
• Market time increased from 114 days to 128 days

This is creating the most competitive environment for sellers we've seen in several years.

Why Homes Are Taking Longer to Sell

One of the report's most telling statistics is that:

• 69% of active listings have been on the market for more than one month.
• Nearly half (47%) have been listed for over two months.

These numbers illustrate how today's market differs from the fast-paced environment of 2020–2022.

However, the report also notes that 35% of June sales still went under contract within the first two weeks, showing that buyers are responding quickly when homes are priced correctly and presented well.

Mortgage Rates Remain the Biggest Story

The housing market continues to be driven by financing costs.

At its latest meeting, the Federal Reserve kept short-term interest rates unchanged, emphasizing that inflation has not yet cooled enough to justify cutting rates. While the Fed does not directly set mortgage rates, its policy significantly influences the bond market.

Currently:

• 30-year mortgage rates remain around 6.5%
• Markets expect the Fed to remain cautious through the coming months
• Future inflation and employment reports will largely determine whether mortgage rates move lower later this year

Higher financing costs continue to reduce affordability and keep many buyers on the sidelines.

Luxury Market Slows Further

Luxury properties continue to experience the weakest demand.

The report shows:

• Luxury inventory increased.
• Buyer demand fell 9% in just two weeks.
• Homes above $2 million now average approximately 255 days to secure a buyer.

For ultra-luxury properties, marketing strategy and pricing have become even more important than during previous years.

What Sellers Should Know

Today's market rewards preparation.

The report emphasizes that sellers who:

• Price based on current market conditions (not past sales),
• Present their homes in move-in-ready condition,
• And compete effectively with neighboring listings,

continue to achieve successful sales despite the slower market.

Overpricing, on the other hand, often leads to extended market time and eventual price reductions.

What Buyers Should Know

For buyers, today's market presents opportunities that were rare just a few years ago.

With more inventory available, buyers can:

• Compare more properties.
• Negotiate more favorable terms.
• Include contingencies more comfortably.
• Face less competition than during the pandemic-era market.

While mortgage rates remain elevated, buyers who find the right property today may also have the opportunity to refinance if rates decline in the future.

The Bottom Line

The Los Angeles housing market has shifted from an extreme seller's market to a more balanced environment. Homes are still selling, but success depends far more on pricing, preparation, and realistic expectations than it did just a few years ago.

For buyers, increased inventory offers more choices and negotiating leverage. For sellers, understanding today's market and developing the right strategy is the key to achieving a successful sale.

Whether you're considering buying, selling, or simply curious about your home's current value, staying informed about these changing market conditions can help you make better real estate decisions.