LA Housing Market Update:
A Buyer-Friendly Shift
The Los Angeles housing market continues to shift in favor of buyers, with several key trends emerging:
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Increased Inventory and Longer Market Times: Active listings have surged to 11,141 homes, a 45% increase from last year’s 7,708. Homes are now taking longer to sell, with the Expected Market Time rising from 62 days last year to 90 days today. This extended timeframe allows buyers to make more informed decisions while having more choices than in recent years.
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Stable Demand and Improved Purchasing Power: Pending sales remain similar to last year, with 3,722 current pending sales compared to 3,718 last year, indicating steady demand. Additionally, mortgage rates have decreased from 7.5% in April to approximately 6.75%, enhancing buyers' purchasing power. For instance, buyers looking for a $5,000 monthly payment can now afford homes up to $963,750, compared to $893,750 in April.
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Price Adjustments: With increased competition and longer market times, 30% of homes have seen price reductions, reflecting a more cautious seller mindset.
Overall, the LA housing market is providing much-needed relief for buyers, with more options and improved affordability
Los Angeles County Housing Summary
- The active listing inventory in the past couple of weeks jumped by 631 homes, up 6%, and now sits at 11,157 homes, its largest rise of the year. In June, 25% fewer homes came on the market compared to the 3-year average before COVID (2017 to 2019), 2,211 less. Yet, 781 more sellers came on the market this year compared to June 2023. Last year, there were 7,708 homes on the market, 3,449 fewer homes, or 31% less. The 3-year average before COVID (2017 to 2019) was 13,290, or 19% more.
- Demand, the number of pending sales over the prior month, decreased by 59 pending sales in the past two weeks, down 2%, and now totals 3,722. Last year, there were 3,718 pending sales, nearly identical to today. The 3-year average before COVID (2017 to 2019) was 5,543, or 49% more.
- With supply climbing fast and demand falling, the Expected Market Time, the number of days to sell all Los Angeles County listings at the current buying pace, jumped from 84 to 90 days in the past couple of weeks. It was 62 days last year, hotter than today. The 3-year average before COVID (2017 to 2019) was 72 days, also faster than today.
- In the past couple of weeks, the Expected Market Time for homes priced below $750,000 increased from 60 to 61 days. This range represents 26% of the active inventory and 38% of demand.
- The Expected Market Time for homes priced between $750,000 and $1 million increased from 58 to 64 days. This range represents 19% of the active inventory and 26% of demand.
- The Expected Market Time for homes priced between $1 million and $1.5 million increased from 77 to 88 days. This range represents 18% of the active inventory and 18% of demand.
- The Expected Market Time for homes priced between $1.5 million and $2 million increased from 106 to 113 days. This range represents 10% of the active inventory and 8% of demand.
- In the past two weeks, the Expected Market Time for homes priced between $2 million and $3 million increased from 148 to 161 days. The Expected Market Time for homes priced between $3 million and $4 million increased from 196 to 220 days. The Expected Market Time for homes priced between $4 million and $8 million increased from 360 to 433 days. The Expected Market Time for homes priced above $8 million increased from 1,164 to 1,614 days.
- The luxury end, all homes above $2 million, account for 27% of the inventory and 9% of demand.
- Distressed homes, both short sales and foreclosures combined, made up only 0.6% of all listings and 0.5% of demand. Only 40 foreclosures and 26 short sales are available to purchase today in all of Los Angeles County, with 66 total distressed homes on the active market, up three from two weeks ago. Last year, there were 50 total distressed homes on the market, similar to today.
- There were 4,032 closed residential resales in June, down 11% compared to June 2023’s 4,552 closed sales, and down 8% from May 2024. The sales-to-list price ratio was 100.3% for all of Los Angeles County. Foreclosures accounted for just 0.4% of all closed sales, and short sales accounted for 0.1%. That means that 99.5% of all sales were good ol’ fashioned sellers with equity
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