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LOS ANGELES, CA — Despite a recent uptick in mortgage rates, California’s housing market still saw a spike in home sales and prices in Southern California, according to February data released by the California Association of Realtors Tuesday.
The spike in prices starts the year on a more bullish note than many housing forecasters expected for 2024. The median price of an existing single-family home in Southern California jumped 7 percent over last year to $825,000. February’s average price of a single-family home in the Los Angeles metro area rose $40,000 over January’s average, to $790,000. For all of Los Angeles County, however, the average price of a single-family home declined in February to $817,100, from $833,000 in January.
Heading into the year, Zillow forecast a 2.2 percent price decline over 2024 for the Los Angeles Metro area. Even the California Association of Realtors, which offered one of the rosier housing forecasts for the year, prognosticated a 6.2 percent rise in median prices over the next year.
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In fact, Los Angeles and Orange Counties haven’t seen sales levels this high since September 2022, with home prices rising in Orange County and the Los Angeles metro area, the California Association of Realtors said Tuesday.
And homes aren’t sitting on the market for as long as they did last year on average. The median number of days it took to sell a California single-family home was 22 days in February compared to 35 days in February 2023.
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Orange County’s average price rose from $1.32 million in January to $1.35 million, up from $1.159 million in February 2023.
The statewide median price recorded a strong year-over-year gain in February, gaining 9.7 percent from $735,300 in February 2023 to $806,490 in February 2024.
The state’s highest median home price in February was San Mateo County’s $1.92 million.
February’s sales pace was 12.8% higher from the 257,040 homes sold in January and up 1.3% from a year ago, when a revised 286,290 homes were sold on an annualized basis.
The monthly sales increase was the second straight month of double- digit gains for California. It was also the second consecutive month of year- over-year gains, but the improvement was mild.
“With mortgage rates on the uptick since the start of the year and concerns about rates staying elevated for at least the first half of 2024, the housing market could struggle to build on the momentum exhibited in the first two months of this year,” the association warned in its report. “However, tight inventory conditions should keep the market highly competitive and provide support for prices.”
While it is likely that sales will stay below this level in the first quarter of 2024, statewide home sales on a year-to-date basis remained positive with an increase of 3.4%, suggesting a better spring home purchasing season than last year, according to CAR.
“Housing supply conditions in California continued to improve in February with new active listings rising more than 10% for the second straight month,” CAR President Melanie Barker said. “This is great news for buyers who have been competing for a dearth of homes for sale, and the momentum will hopefully build further as we enter the spring home buying season.”
The early data may shift expectations for the year in which many experts anticipated flat sales sales and prices.
“CAR felt optimistic in its 2024 housing market forecast with falling mortgage rates, rising prices, economic expansion, and with demand for homes strong,” the California Association of Realtors predicted in December. “Housing affordability will remain flat. Out of all of it, and despite an outmigration of Californians to low-tax states, the state remains viable and people want to buy homes here.”
The full report can be viewed here.
City News Service and Patch Staffer Paige Austin contributed to this report.
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