Hidden Buyer's Markets in Los Angeles: Sept. '21
Hidden Buyer's Markets in Los Angeles: Sept. '21
Let’s face it, this is a generally challenging time to be a home buyer. Rising construction costs, low inventory of homes for sale, a strong seller’s market, and a large pool of buyers. Exacerbated by the fact that you’re a home buyer in one of the most competitive markets in the country, Los Angeles. But in challenging situations, we all face a choice to be an architect or a victim of our circumstances. We can choose to design our own future or allow circumstance to design it for us. In this article, we will share some areas within LA where a buyer can find leverage. Areas where your dollar has stronger buying power and your offer carries more weight. Hidden ‘Buyer’s markets’ within a larger Seller’s market. I know, we went deep quick, but it’s important to understand that no matter what the circumstances are, there is always opportunity. It’s like choosing the third side of a coin in a coin toss.
My wife and I moved to LA some years back, and our dream was to buy a single-family home. As our internet search began, we quickly realized we were priced out of 95% of the areas we wanted to live. And we were 100% priced out of single-family homes. But we knew that if we could just get into home ownership in LA, then we would be able to start gaining equity and later roll that equity into the purchase of what we really wanted. We bought a townhome in an area of the city where we could compete, two short years later we sold it for profit, rolled our equity, and bought a single-family home in an area we really liked. The point is, the two sides of the coin said you can either “buy” or “not buy” a single-family home, so we chose the third side. An alternative way to get to our desired outcome.
By definition, a Seller’s market is a market where there’s more demand for homes than there is supply. And although LA as a whole is a Seller’s market, when you look at it by neighborhood you start to see areas that are not seller’s markets by definition. These areas are little emerging ‘Buyer’s markets’ within the larger Seller’s market of LA. These are the areas that are increasing in inventory, decreasing in Average Sales Price. Areas where buyers are getting homes for less than asking and where homes don’t fly off the market at break-neck speed. As a buyer, these are the areas where you have more leverage. We have analyzed Single-Family home sales results over the last 3 months across LA, using buyer friendly criteria like inventory increases, sold prices under asking, and increases in Days on the Market to bring you the LA’s Hidden Buyer’s Markets for September.
IN THE CITY:
Conveniently located near almost everything, Culver City has been a hot market for the past few years. But since June, month-over- month inventory has dramatically increased in Culver City. More inventory means more buyer leverage. As a result, Average Sold Price has decreased -6% and List-to-Sold Price has decreased each month by -1% on average. Homes are on the market an average of 2% longer each month in this area. Sellers are right- sizing their asking price, and Average Sold price is decreasing with more and more inventory hitting the area each month.
This area is just east of Inglewood, made up by Gramercy Park, Westmont, and west of the 110. This are felt an uptick due to the Inglewood home surge, but has seen a shift over the summer. Since June, inventory has increased 7% per month on average. The average Sold Price has slightly decreased by -1% each month and the List-to-Sold Price has followed suit. Homes in this area are on the market +30% longer month-over-month as well.
On the West-Side:
Home to LAX, Loyola Marymount, and just south of Playa del Rey, Westchester offers opportunity for buyers trying to find value and a less competitive market near the beach. Since June, Westchester has averaged +20% inventory increases each month. Although Sold Prices have slightly increased +1%, List-to-Sold prices have decreased -3%. Homes are on the market an average of 50% longer on a month-to-month basis. Sellers are again right-sizing their asking price and Sold prices are softening.
Marina del Rey
Since June, Marina del Rey has shown a monthly inventory increase of +7%. Average Sold Price has decreased -2% on average each month and List-to-Sold price has decreased -1% on a month-to-month basis.
In the valley:
Just east of Chatsworth, Porter Ranch is gaining inventory +16% month-to-month since June. Sold Prices are increasing +6%, yet List to Sold prices are decreasing -2%, showing that Sellers are right-sizing inflated asking prices. Homes are still selling quickly here, with Days on the market decreasing +6% each month since June.
Just over the hill into the Valley, Sherman Oaks has seen inventory increases +11% on a month-to-month basis since June. Buyer demand is still slightly driving prices up, with Average Sold price increasing +1% and List-to-Sold price +1% on a month-to-month basis. Even though prices are increasing, they are increasing slower than before. Homes are on the market +4% longer each month as well.
Located in the northwest part of the Valley, Chatsworth has seen inventory increases of +10% on a month-to-month basis since June. The Average Sold price has decreased -2% each month while List-to-Sold price has remained flat. Homes in the area are on the market +26% longer on a month-to-month basis
The LA marketplace will continue to shift in the upcoming months, and it’s important to know what to look for in the home buying process to best position yourself for success. The Knight Group is always focused on looking ahead of the curve by leveraging market data, like you’ve read in this article, so that we can glean insights and hidden value for our client’s success. If you have questions or would like some assistance in your home search, we’d love to connect with you and help you reach your goals.
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