Los Angeles
LA home market stalls as signed contracts and listings decline
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LA County home sales show slight uptick in August
Pandemic upends traditional selling seasons as shock of higher interest rates wears off
Home sales ticked up slightly during August in Los Angeles County, but the market’s struggles against low inventory and high interest rates prevented it from reaching the numbers of a year ago.
Signed contracts and new listings in Los Angeles both saw double-digit declines in a year-over-year comparison, according to a monthly report from brokerage Douglas Elliman. There was a 23 percent decline in signed contracts with 2,146 completed deals in August compared to 2,793 in the same month last year. New listings dropped 33 percent since a year ago, with 2,043 new homes coming on the market in August, compared to 3,054 in August 2022.
Jonathan Miller, the report’s author, wrote that the annual comparisons contrast the less exuberant 2023 market with the bonanza days of 2022. The Federal Reserve started a series of interest rate hikes in March 2022.
“The year-over-year decline in newly signed contracts still reflected the momentum of last year’s pandemic-era housing boom,” the report states.
However, Los Angeles business looked better in month-to-month comparisons. Signed contracts rose 2 percent in August compared to July, when there were 2,094 deals. New listings rose 3 percent in August from July’s total of 1,976.
In a pre-pandemic market, the uptick could have been attributed to seasonal fluctuations in the market, said Jennifer Lind, president of Coldwell Banker’s West Region. Sales typically increased in the spring and back-to-school seasons, but the pandemic upended traditional seasonal rhythms. As a result, market activity looks hard to predict for the fall.
“It will be dictated on how interest rates fluctuate,” Lind said.
Donovan Healey of the Beverly Hills-headquartered Healey Gavin Group at Coldwell Banker Realty said one reason business picked up in August was because the shock of new interest rates wore off. But agents have to be savvy to find listings that will sell.
“The equation has not changed. We have lower supply and lower demand because rates are higher,” Healey said. “As an agent, you have to be smarter and pick your battles. Experienced agents will not give attention to listings that are overpriced.”
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