Los Angeles Real Estate Market Update - Feb/March 2024

The Los Angeles Real Estate market had a good start in 2024, with both housing supply and buyer demand showing signs of improvement.

January home sales in California reached the highest level in six months. With rates dropping sharply at the end of last year, many homebuyers on the sidelines reentered the market and pushed sales up a notch in the first month of 2024 with the statewide existing single-family home sales registering a year-over-year gain for the first time in 31 months. While the market will likely face headwinds in the coming months as mortgage rates continue to fluctuate, the lending environment is expected to be more favorable in 2024.

The statewide median home price for January 2024 was $788,940, showing a positive 5.0 percent increase from $751,700 in January 2023. Year-to-date statewide home sales exhibited a commendable increase of 5.9 percent, signaling sustained momentum in the California housing market.

The recent rebound in the market reported last week should continue through February and the first half of March. Much of the recent rise in closed sales has been driven by the top-end of the market, which is once again rising by double digits in the $1 million and up segments of the market. In addition, the rise has been fairly consistent in various parts of the state with more affordable and denser urban metros all showing similar improvements this year.

The primary sign indicating that consumers have begun to adapt to the current rate environment is demonstrated by how competitive the market has gotten before the Spring homebuying season has even gotten underway. For example, days on market continues to drop as homes start to sell more quickly. Typically, the median time on market peaks in January each year and falls throughout the busy season. In 2023, the median time from the time a home hit the market and went pending peaked at 42 days. This year, it peaked at 36 days and has been falling for the past four weeks in a row to just 20 days last week. More homes selling above list price has been trending up and was almost half of all closed sales in the third week of February.

Despite mortgage rates rising in the last few weeks, home prices should remain on their upward trend and continue to grow moderately from a year ago in the next couple of months as housing supply remains tight.

-California Association of Realtors (CAR) & NoradaRealEstate.com