It’s a great time to sell LA real estate, a year-end report from Pacific Union chief economist Selma Hepp confirmed.
Declining inventory combined with buyer demand led to a rise in median house prices, according to activity in the 20 LA real estate markets where Pacific Union International operates. To put that in everyday language, there were fewer homes available, which created more competition among buyers and pushed up sales prices. It’s expected the inventory decline will continue into 2018, making conditions favor sellers over buyers.
LA real estate sales
Total sales increased by 1 percent over 2016. The decline in inventory meant fewer homes for sale, and thus limited growth in sales totals. The largest increases in sales were seen in Downtown LA ( partly due to some new high-end developments), the Hollywood Hills, Silicon Beach, and Beverly Hills.
Sales of homes priced below $1 million actually fell — by 5 percent — while the sale of homes priced above $3 million increased by a staggering 22 percent.
LA real estate prices
The median price in 2017 — meaning the middle of the prince range, not the average price — was $855,000, an increase of 8 percent over the year before. And in six LA neighborhoods, median prices saw double-digit percentage increases over 2016’s numbers. The largest gain was 17 percent in Beverly Hills/Holmby Hills/Bel-Air, followed by a 15 percent increase in South LA.
LA real estate inventory
The biggest factor in all of this is inventory. The LA real estate market has seen its supply of homes dwindling for years. You see this especially with homes priced under $1 million (the price point at which we saw a decrease in sales). The inventory of homes in this price range was down by 21 percent from December 2016, and down 27 percent when compared to December 2015.
That downward trend is expected to continue in 2018, which means that it’ll be a competitive market for buyers, but also a great market for sellers of LA reale state to get the most out of their home sale. In 2017, more homes sold for more than their asking price than in 2016. LA real estate also sold in 36 days on average, 10 days faster than in the last quarter of 2016.