How hot was it? Plunge puts pandemic peak in perspective
Signed contracts down 20 percent from last October in latest indicator of resi cooling
Angelenos bought nearly 1,000 fewer single family homes last month compared with October 2020 — a data point that demonstrates just how hot the market got during last year’s pandemic-fueled buying spree.
The numbers on signed contracts come from a Southern California report published today by appraiser Jonathan Miller.
“We’re at the tail end of the period a year ago where the market was supercharged coming out of lockdown, and sales and inventory were in the stratosphere,” Miller said. “And we’re comparing against that distorted period.”
Buyers in L.A. County signed 4,728 new signed contracts on single family homes in October 2020. Last month the figure was 3,794, representing a drop of slightly more than 20%. All price brackets saw some decline.
The year-over-year decrease in signed contracts was accompanied by an even more dramatic drop in new listings. L.A. County sellers listed nearly 6,300 single family homes in October 2020; last month they listed about 2,300, a dip of about 64 percent.
The report found that similar trends in Orange County, last month’s single family signed contracts were down 25% compared with October 2020, while new listings fell 42%.
The inventory challenge is unlikely to go away anytime soon, and the issue is only exacerbated by California’s extreme housing shortage. Analysts contend the state needs to add millions of units to its housing stock to meet demand. In recent weeks, Gov. Gavin Newsom has signed into law a flurry of bills aimed at creating housing, including the highly controversial Senate Bill 9, which eliminates most single family zoning in California; the measures will have some positive impact on the housing supply, according to researchers, but not nearly enough to solve the problem.