While April’s staggering year-over-year home sales figures can be attributed to last spring’s statewide stay-at-home order, the meteoric rise in Los Angeles home prices has been driven by ultra-low inventory and high demand.
According to the California Association of Realtors’ (CAR) April home sales and price report, the median price of an existing, single-family detached home in Los Angeles spiked 25.1 percent on an annual basis.
The typical home sold for $707,050, a price difference of $141,880 compared to April 2020. Home prices also increased from month to month, climbing 5.8 percent over March’s median of $668,220.
April home sales soared 65.8 percent annually, unsurprising given that there was a ban on in-person showings and open houses in Los Angeles County during the same period last year. Sales continued to climb from March to April, rising 11 percent as the busy spring homebuying season shifted into high gear.
The typical LA home spent just one week on the market, down one day from the previous month and five days from one year ago. The unsold inventory index was unchanged from March at 1.8 months of supply but remains significantly lower than the 3.3 months of supply recorded in April 2020.
California’s median single-family home price crossed the $800,000 threshold for the first time ever, amounting to $813,980. This figure was up 7.2 percent from March and 34.2 percent from April 2020. There were 458,170 closed escrow sales on a seasonally adjusted basis, 2.6 percent higher than the previous month and 65.1 percent higher than one year earlier.
“California continues to experience one of the hottest housing markets as homes sell at the fastest pace ever, with the share of homes sold above asking price, the price per square foot and the sales-to-list price all at record highs, while active listings remain at historic lows,” said CAR President Dave Walsh.
Statewide, the typical single-family home went under contract in just seven days — another record low. In April 2020, it took a median of 13 days for a comparable home to sell. Unsold inventory declined from 1.7 months in March to 1.6 months in April, standing in stark contrast to the 3.4 months of supply observed in April 2020.
In the report, CAR Vice President and Chief Economist Jordan Levine emphasized the need for more supply, indicating that it would “alleviate pressure on home prices.” For months, housing experts have been predicting that homeowners would put their homes on the market once vaccination rates improved, but a surge in listings has yet to materialize despite the more than 33 million shots that have been administered across the state.
“Not only do skyrocketing home prices threaten already-low homeownership levels and make it harder for those who don’t already have a home to purchase one, it also brings to question the sustainability of this market cycle,” added Levine.