LA MARKET OVERVIEW
Los Angeles Real Estate Market Overview: Trending Prices
Even during a world-wide pandemic, the Los Angeles housing market still found a way to survive and thrive. This is a very well-known fact about this southern sweet spot of California given everyone wants to live there. The combination of beautiful sunny weather and home locations with remarkable views is simply unmatched by any other state in America. The coming of the 2021 fall season is going to bring a lot of travelers from the north who are looking to start their new life in a much sunnier state where the cost of a heating bill doesn’t really exist. About 130,000 units are going to be constructed in the Los Angeles area right near UCLA by 2022 which means 2023 is going to produce the emergence of about 140,000 new homes. Keep reading to see how the Los Angeles real estate market has exponentially increased in value since the unprecedented year of 2020.
Prior To the Boom of 2021: The Original 2021 Forecast
Towards the beginning of 2020, there was little hope for the short-term future of the Los Angeles real estate market given the rapidly increasing movement restrictions set in place due to the COVID-19 pandemic. Although the market took a slight pause amidst the original hustle and bustle, the 2021 Los Angeles real estate market has been on a record-breaking war path to exceeding the accessed value of previous years by a long shot. This can easily be seen by conducting a quick comparison between 2020 and 2021 statistics to date.
According to the California Association of Realtors, the Los Angeles housing market recovery may soon surpass the rest of the nation. They found that the number of sales made for single-family homes increased by 5.6% since August of 2020. This means that 438,190 more transactions were made in September of 2021. This was not the only portion of the housing market that saw a significant increase. CAR also found that the median home price for single-family houses in Los Angeles is $808,890 which is about 13.5% higher than it was in September of 2020. Clearly, the original assumptions about the potential for a market dip in 2021 were quite incorrect as the Los Angles housing market is extremely desirable and will continue to increase as shown by the undeniable offset of never-ending demand.
The Record-Breaking 2020-2021 Los Angeles Real Estate Market
The finalized Assessment Roll for the 2020-2021 year displayed a 3.7% growth in the Los Angeles housing market as explained by Forbes. This Assessment Roll represents all the properties that exist in the Los Angeles area and are able to be taxed. Jeffrey Prang, the Los Angeles County Assessor, was able to determine that the value of taxable properties in Los Angeles is $1.76 trillion. All the values meticulously calculated in the 2020-2021 Assessment Roll are completely aligned with the value of Los Angeles properties since January 1st, the lien date. Although this 3.7% growth is a record-breaking increase for this year, Los Angeles County is no stranger to these kinds of market increases. Given this marks the 11th straight year where the Assessment Roll has grown in this area, prospective buyers can only assume that the 2021-2022 roll is going to top the charts once again.
The Los Angeles Assessment Roll: Prospective Buyers Take Note
As a prospective buyer of a home in Los Angeles California, you must take heed to this value because it has a significant effect on what the assessed values of your personal property taxes will be. After determining how your property taxes are built upon the overall Los Angeles Assessment Roll, you can then truly understand how healthy and valuable the real estate market has become in just the matter of one year; a highly unprecedented year at that. All over the country, more people need homes that are continuously being swept off the market and Los Angeles County is no different. Due to the unmistakable appeal of this area to prospective buyers and aspired investors, the value of these incredible homes has increased which is supported by the higher Assessment Roll value as well.
What Role Do Property Sales Play In the Roll?
The desire of aspiring LA natives to live in this incredible area is made clear by both the increase in demand and decrease in supply. Once a family finds a home here they love, they never really want to leave. The number $1.7 trillion comes into play when discussing the overall assessed value of actual real estate being sold in Los Angeles. As the single-family homes continue to fly off the market, more money is being funneled back into the school systems where the children of the locals constantly attend.
What’s not to love about an area that truly has it all? The affluent homes along with amazing school systems is enough to attract various families to an area that is nothing short of its own micro-economy. In total, the amount of real estate sold in Los Angeles as calculated for the 2020-2021 Assessment Roll was $44.9 billion. This money solely produced by real estate sales was added to the rolls in order to properly account for the significant value added through property sales.
2021 Los Angeles Assessment Roll: Crunching the Numbers
The inventory in Los Angeles is steadily decreasing due to the large number of individuals hoping to find their dream home in such an amazing location. The detailed Assessment Roll release by Jeffrey Prang showed that Los Angeles County alone is home to about 2.58 million different real estate and business plots.
As stated by Forbes, this overall 2021 Assessment Roll determination includes the following:
- 250,190 apartment complexes
- 1,885,879 single-family homes
- 248,293 commercials as well as industrial properties
- 161,488 business property assessments
This monumental upshift in the value of the Los Angeles real estate market broke records and produced an even more affluent residency for every homeowner living in Los Angeles.
How Does The 2021 Los Angeles Housing Market Currently Stand?
The 2021 housing market in Los Angeles County is doing better than “just fine”. The entire world saw a down turn in production in terms of larger scale sales such as real estate and hometown purchases as related to a bi-weekly trip to the grocery store. With a global pandemic on the loose, not many people were able to leave their home for quite some time. These insurmountable odds didn’t stop the overwhelming success seen by the Los Angeles real estate market thus far in the year 2021. This county was among the few within southern California that saw the greatest amount of recovery from slight decline in sales. Only the Los Angeles economy didn’t just recover, it completely flourished in the wake of prospective homeowners looking to start their new life in a gorgeous area.
The Metrics of the 2021 Los Angeles Real Estate Market
The future projections for the Los Angeles County area are best made by taking a closer look at the current trends displayed the fall 2021 housing market. In the month of September, the price for homes in Los Angeles increased slightly causing the median price for the entire region to top off at $760,000. This number was pulled from CAR’s most recent resale report to show that this was a 18.8% increase from the previous year (2020).
In the month of August in Los Angeles alone, the median sale price for a home was determined to be $830,000. This is a 2.5% increase month-to-month as well as a 19.8% increase year-to-year. On the other hand, the median list price was $800,000 in the same month which was an increase of 5.1% year-to-year.
By looking at CAR’s data, compared to the $809,750 July 2021 sale price and the $692,630 August 2020 sale price, Los Angeles County is constantly seeing an upward trend.
The Bright Future Projections for the 2022 Los Angeles Real Estate Market
Although there was a significant boost in buying power by Los Angeles homeowners in 2021, the supply of homes is going to take a slight downturn in the year 2022. This is simply due to the fact that Los Angeles County is an extremely desirable place to live so everyone wants their piece of the pie. Throughout the entire nation there are supply restraints not only for the real estate industry, but also for more common occurrences such as auto part maintenance. That being said, CAR’s “2022 California Housing Market Forecast” projects there is going to be about a 5.2% decrease in the number of single-family homes available to new prospective buyer. This percentage brings the total number of houses slightly down to 416,800 units.
As this affluent area continues to gain popularity, the market value for the homes located there are going to also increase to a median price of about $834,000. This number is up 20.3% from the median price being seen in the current 2021 Los Angeles housing market. Fortunately, the slower pace that’s going to be supported in Los Angeles will be a breath of fresh air for potential buyers who weren’t quite able to find the home or property they were looking for during their 2021 search. There is going to be less market competition out their investors and buyers have a much better chance at finding their perfect forever home. If anyone is looking to purchase property or a home in this area, now is the time to jump on the current market opportunities because the competition will only increase in the year 2022.
Conclusion: The Los Angeles Real Estate Market Is On a Steady Incline
As proven by all the stated facts, the overall housing market value in Los Angeles is going to continue increasing for many years to come. There are numerous attracting factors that many prospective buyers simply can’t turn down. When a family is considering where they want to purchase their next home, it’s truly difficult not to consider Los Angeles County as their first option. The more people continue to purchase real estate in Los Angeles, the more valuable the overall area is going to become. Both school systems and the local government in general are benefiting from the increasing number of people deciding that Los Angeles is the perfect place to investment and to purchase their forever home.