Los Angeles, CA

Los Angeles median home price soars to $945,500

Beth Torres

A recent housing report shows home prices continue to skyrocket in Los Angeles, up over 11% compared to just a year ago. According to Redfin, the median sale price in the Los Angeles market was $945,500 as of February 2022. This statistic includes all home types—single-family homes, townhouses, and condos/co-ops.

Break it down further, and you’ll find the median sale price for a single-family home in Los Angeles comes in at $1.1 million (up 12.2% year-over-year). The median sale price for a townhouse is $689,000 (up 14.8% year-over-year), while the median sale price for a condo/co-op is $695,000 (up 17.8% year-over-year).

Bidding wars, days on the market

Last year, Los Angeles homes spent an average of 50 days on the market before selling. This year, homes sell on average after only 36 days. And if you’re a buyer, be aware that the list price may only be a starting price for the home of your dreams. Approximately 59% of homes sell above list price.

A look at agent insights from recently sold homes shows how competitive the Los Angeles housing market has become. Redfin agent Amy Black reported on a three bedroom, 1.75 bath, 1,750 square foot Los Angeles home that received 20 competing offers in just six days. The home sold for 26% over the list price for $2.25 million. According to Black, the seller received many all cash offers and some were over $400K above the asking price.

Why is Los Angeles seeing steep hikes in home prices?

Record-low interest rates on mortgages is one reason for the surge in home prices. These low interest rates have spurred many buyers into entering the housing market over the last few years. Buyers have been eager to lock-in low interest rates and get on the housing ladder while they can. Now that interest rates are on the rise, some experts expect to see a gradual cooldown in the housing boom.

Housing demand has also increased as more people work from home and are looking to upgrade their current accommodations to include a home office. Variety reports that the downtown Los Angeles luxury market is in the middle of a boom. Homebuyers are lured by the live/work arrangements offered by the new mixed-use condominiums now available downtown, boosting sales by 16% year-over-year.

An ongoing lack of supply is another huge driver of Los Angeles’ home prices. Increasing the housing stock by allowing new development would help alleviate the housing shortage, which has reached a crisis stage. Despite this, many California cities and counties have implemented zoning laws and building restrictions that have deterred developers from building new homes.

How have Los Angeles’ soaring home prices affected you?

Have you been priced out of the hot Los Angeles’ housing market? Are you considering relocating to a more affordable state? Tell us your thoughts in the comments section below.

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