Short and sweet. Is the Los Angeles real estate market still hot? Let's take a look at how the market is performing. (Short answer: Yes, and getting hotter.)
We will be comparing January through June 2016 vs. 2017. Looking at both the City of Los Angeles as well as L.A. County.
City of Los Angeles
- Number of new listings is up 3%
- Closed sales are up 4%
- Number of homes for sale hasn't really changed.
- Days on market is a little faster (not much)
- List price to sales price ratio is the same (whether the home sells over or under asking price).
Translation: This means demand is increasing right along with the increasing supply.
- Median price went from $810,000 to $860,000, up 6%.
- Average price went from $1,206,000 to $1,325,000, up almost 10%.
(Hint: The further the average and the median are from each other, means there is a wide range of prices in L.A.)
Translation: This means the meat and potatoes of L.A. is appreciating very steadily at 6%, while the top of the market continues to expand and reach new heights, and which pushes the average much higher.
Just the difference between the average and median sales prices alone says a lot about the market. This means that there are some very expensive homes selling in Los Angeles which is significantly pulling up the average.
Case in Point
Jan - Jun 2016 in L.A. County, there were 7 homes sold over $20 million (The same for 2015 as well). However, in 2017, there were 13... Almost twice as many.
Los Angeles County
- Number of new listings is down slightly
- Closed sales are up by 5%
- The number of homes for sale is down.
- Days on market is much faster in 2017 compared to 2016, from 59 days to 50 days.
Translation: This means not only is supply decreasing, BUT demand is also increasing. Double whammy.
- Median went from $586,000 to $618,000, up 5.5%.
- Average went from $876,000 to $934,000, up 6.5%.
Translation: The average didn't increase as much as it did in the City of L.A. because there are roughly 70 times the number of closed sales in L.A. County (3,300 sales vs 22,000 sales in the first six months of the year), so those super high prices are just a drop in the bucket in terms of the entire market.
Most Interesting Fact
In L.A. County, the sales volume of all single family homes in the first half of the year (the total dollar amount of sales) went from $20 billion in 2016 to over $22.3 billion 2017. That's an 11% increase in just one year.
That's a HUGE jump!