In March, for the second consecutive month, LA County real estate set a record high median price. The median jumped to $585,000, a $5,000 increase over February and a 6.6% increase over March 2017.
The record held across six major counties of Southern California as well. The new median record for those counties was $519,000 up from $479,000 a year earlier.
LA real estate is setting records all over the place: Highest median price, highest interest rate, highest sale. There seems to be no slow-down of the HOT HOT LA real estate market; everything is on the go.
As we reported earlier in the week, interest rates were at their highest level in four years, up about .5% since the beginning of the year. But even the rising interest rates don’t seem to be slowing down sales.
The total number of homes sold in March was up nearly 43 percent versus February. There have been periods of much higher sales in the past but currently there is also a lack of inventory at play so houses are selling in fewer days. It is not uncommon for properties to go on the market and be in escrow almost immediately.
Davi Nogueira, a specialist in Downtown and Silver Lake, says the market is on fire. He recently put a client in escrow, after going $125,000 over asking price. And it was the ninth property they made an offer on. He says “Norheast LA is the next Brooklyn; start investing before it’s too late.”
The current rate of price increases is really unsustainable but that said, LA is unique in there is a shortage of land across the board and it is difficult to build. In New York, you can put up a 40-Story building almost anywhere and everywhere. In Los Angeles, there is a shortage of space, numerous regulations, and residents battling developments and developers. For decades, not enough homes have been built and the problem is not set to be fixed anytime soon.
In addition to high prices, next week is expected the highest ever sale in Los Angeles County. Hotelier Peter Morton is in contract to sell his oceanfront property in Carbon Beach for $110 Million. Better known as Billionaire’s beach, this Malibu sale will eclipse the previous highs of $100 Million for the Playboy Mansion and another $100 Million Beverly Hills sale. Both of these were in 2016.
Prices can’t go up for ever but with a never-ending supply of sunshine, beaches, Hollywood star-power, and much more, it will be interesting to see how the LA real estate market plays out.