Good morning, and welcome to the Essential California newsletter. It’s Thursday, Aug. 18. I’m Andrea Chang, a wealth reporter in the Business section.
The Southern California housing market continues to cool off, with the region’s median home price falling slightly in July from a month earlier. The real estate cooldown is being felt across the state, with a notable drop at the beginning of the summer in the Bay Area.
In SoCal, it was the third straight month prices failed to increase as some would-be buyers put off purchasing a home due to rising mortgage rates. The six-county region’s median sales price was $740,000 last month, 1.3% below June’s level and 2.6% below the all-time peak this spring, according to data released Wednesday by real estate firm DQNews. Compared with July 2021, sales last month fell nearly 35%.
[Read “Southern California home prices slipped in July. More drops may be coming,” in The Times.]
Andrew Khouri, one of our housing reporters, says the latest figures are an indication that home values may have peaked and will continue to fall. Many home sellers are now cutting their asking prices, extending the length of contingencies and paying for repairs to get deals done, a dramatic change from earlier this year.
Covering wealth in Los Angeles is a fascinating beat, in part because often what’s going on in the broader economy doesn’t seem to affect the ultra-rich. Take, for instance, the luxury condo market, which I wrote about a few weeks ago. Despite a softening housing market overall and concerns about an impending recession, developers are pushing ahead with over-the-top condos, including a pair of $50-million penthouses at 8899 Beverly in West Hollywood and a $75-million penthouse at the Four Seasons Private Residences Los Angeles.
Demand for lavish condos is high. In the first half of the year, 257 condos sold for $2 million or more in L.A. County, compared with 170 in the same period last year and 75 in the first half of 2020, according to the Multiple Listing Service. And the number of condos in Greater Los Angeles that closed for more than $5 million in the second quarter rose 175% year over year, according to a report by Sotheby’s International Realty.
Last month, a penthouse at the Pendry Residences West Hollywood closed for $21.5 million, making it the priciest condo sale this year and the fourth-most expensive in the county’s history.
Speaking of sky-high home prices, the San Francisco Chronicle reported Wednesday that housing affordability fell in all nine Bay Area counties in the second quarter of 2022 — this despite the recent cooling of the market. Only 18% of home buyers in the region could afford to purchase the $1.495-million median-priced home in the period from April to June, according to the housing affordability index by the California Assn. of Realtors.
If you’re thinking about buying but need some help, the Business section put together a comprehensive step-by-step home-buying guide this spring. You’ll find tips on finding the right real estate agent, an open house checklist, advice on how much to put down and more.
No comments:
Post a Comment