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Los Angeles

Signed contracts uptick points to post-pandemic settling

Increase in November halts downward skein, indicates comparisons are “normalizing” after frenzy

LA uptick in signed contracts points to post-pandemic settling
(iStock)

Signed contracts on single family homes throughout Los Angeles County rose 8.3 percent in November, while condo signings increased by nearly 13.9 percent, according to a Southern California report published today by the appraiser Jonathan Miller.

The county saw 3,290 single family signings last month, about 250 more than November 2020.

The increase reversed a recent trend of declines — year-over-year single family contracts in the county had been falling since June — and reflected a stabilizing housing market more than a year after the peak of the pandemic-driven buying frenzy.

“The year ago spike is behind us, and last fall or winter was when the market was normalizing,” said Miller. “We’re comparing against that now instead of against a supercharged period. Not to say that the market right now isn’t heated, but it’s nowhere near the intensity that we saw in most of 2020 after the pandemic hit.”

The year-over-year increase was largely concentrated among roughly median-level and higher priced houses: Contracts on L.A. County homes priced between $700,000 and $900,000 increased by 28 percent; contracts on homes priced between $900,000 and $1 million increased by 71 percent; and contracts on homes priced between $2 million and $5 million increased 45 percent. Contracts on homes priced below $700,000 decreased.

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The report also showed a sliver of good news for potential L.A. County buyers in the form of more homes entering the market in relatively mid-level price categories. New listings for homes in the $700,000 and $900,000 category nearly doubled, from 201 in November 2020 to 399 last month. New listings for homes priced between $300,000 and $500,000 and $500,000 and $700,000 also rose dramatically, while new listings on homes priced above $2 million fell.

The rise in middle-market inventory, Miller said, likely stems from homeowners looking to sell into what remains a relatively strong market.

“It’s still not enough to change the character of the market as being chronically low in supply,” he added, “but it’s certainly a start.”

A month earlier, in October, the year-over-year report revealed the extent of the pandemic frenzy: That month Angelenos signed roughly 3,800 contracts, down more than 20 percent from the October 2020 tally of roughly 4,700.

In Orange County, November 2021 single family signings were lower than November 2020 figures, although signings increased for homes above $1 million, and new listings were dramatically down.

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LA Housing Market