The Los Angeles-area condo market is waging a quiet comeback. While countless headlines have been devoted to the metro’s record-breaking single-family home prices, median condo prices have inched up simultaneously.
A new report from Redfin suggests the median sale price of a condo in Los Angeles rose by 1.2 percent in August to $529,000. Although this monthly increase may seem trivial, on a year-to-date basis, prices have climbed 9.8 percent.
Active listings have also recovered since bottoming out during the early months of the pandemic, totaling 4,847 in August. Listings were up 5.1 percent compared to July and 9.8 percent over the same period a year ago.
New inventory was relatively limited, with 1,607 fresh listings hitting the market in August. This marked a slight 0.7 percent boost over July’s total. In comparison to August 2019, however, listings were up a remarkable 30.3 percent, underlining the strength of the late summer housing market.
“Many Americans are putting their condos up for sale because they’re realizing that owning a single-family home is now possible for the first time, thanks to record-low mortgage rates and remote work,” said Redfin lead economist Taylor Marr.
“Landlords have also been selling condos that they previously rented out because the rental market has been showing signs of weakness due to the coronavirus.”
Los Angeles’ skyrocketing single-family home prices — which increased 12.8 percent year-over-year in August to $615,000, according to the California Association of Realtors — have buoyed condo sales in recent months. Families that have been priced out of the competitive detached home market are instead shopping for condos while mortgage rates remain favorable.
In August, 1,025 condos changed hands, a 6.8 percent improvement over the volume of sales in July. That being said, the outsized demand for single-family homes amid the pandemic caused condo sales to lag by 0.1 percent on an annualized basis.
Closed amenities and shared common areas have made condominiums somewhat less desirable, yet Marr points out that condos “could become the only type of home that buyers in some areas can afford while also avoiding intense bidding wars.”