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, 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 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.

Article Courtesy of Pacific Union International