August 2021 Los Angeles Market Update - Sales Decline but are Prices?
Median Prices of Homes & Condos - August 2021
HOUSE CONDO Santa Monica $3,500,000 $1,186,00
West Hollywood $2,255,468 $852,094
Beverly Center/Miracle Mile $2,165,000 $837,375
Silverlake / Echo Park $1,263,000 $860,000
Sherman Oaks $1,535,000 $645,000
Woodland Hills $1,187,500 $536,000
The California housing market continues to normalize from the white-hot conditions we experienced at the height of the pandemic with both sales and prices moderating as we slowly transition from the peak home-buying season into the Fall. Housing supply, while improved, remains tight and market competition is still heated with homes flying off the market in record time.
California’s housing market has started to resemble a typical year as sales in the state appear to have peaked in June and July before gradually declining in August.
The month of July 2021 showed some signs of seasonal softening in demand as sales of single-family homes and condos declined from the previous month in most of the counties of Southern California tracked by the California Association of Realtors (CAR).
Even as the pandemic persists and economic uncertainty rises, the housing market, although normalizing, is remaining remarkably resilient with little evidence of an impending foreclosure crisis. Home sales have fallen from 15‐year highs and the number of new mortgage applications have been sliding for nearly 4 months. However, the market is just returning to pre‐crisis levels where excess demand and too little inventory are at “regular” rather than extraordinary levels.
Mortgage Applications - New mortgage applications are roughly on par with 2019 levels, which suggests that the market is normalizing back to pre‐crisis levels rather than cooling or under‐performing.
Mortgage Forbearance - According to new data released by the Mortgage Bankers Association, the number of mortgages that are 90 or more days delinquent fell to 2.72% in the second quarter from 3.27% in the first. That marks the third consecutive quarterly decline and shows that although the broader economy has been significantly impacted by the crisis, homeowners have largely prioritized their mortgage payments
Number of New Listings - The number of new homes being added to MLSs in Los Angeles had been showing signs of improvement during the Spring and Summer, with some genuine increases relative to 2020 levels in recent months. However, as the number of new coronavirus cases begins to rise sharply, the state has begun to fall short of last year again. Last week (Aug.23rd) also marked the 4th week in the past 5 that saw the number of new listings shrink.
Many challenges remain ahead, but for now, rates remain low and buyers may even be getting slightly more bullish on housing.
- California Association of Realtors - Market Minute / Aug.30th