By Jeffery Marino
With prices for homes in Northeast Los Angeles going nowhere but up, it’s hard to believe that hopes were high for a buyer’s market as recently as 2019 and early 2020.
Throughout 2019, the pace of price appreciation slowed to the single digits and even fell a few points year-over-year. And in early 2020, when the pandemic struck, there was reason to assume that prices would fall as unemployment rose during the shutdown.
But the price moderation in 2019 now looks like a blip and the pandemic in 2020 actually pushed prices up, for two reasons: One, potential sellers initially held off listing their homes for sale, leading to an inventory crunch. Two, job loss was not severe among the generally upper middle-income earners who are target buyers in NELA.
The result: Demand has been greater than supply and, accordingly, prices have kept going up.
The housing data for February, the latest available information, indicate that NELA’s bull run is far from over. Inventory was still lower than normal, down 13% compared to a year ago. Competition was still fierce: For the third month in a row, the sale-to-list ratio — which compares the sale price to the asking price — was 104%. Before December 2020, NELA buyers hadn’t paid a 4% premium since September 2018. Lately, a hefty premium has become the norm.
So, here we are: The median sale price in February was $915,000, a 9% increase over February 2020. At that pace, the median home price in NELA will hit $1 million around this time next year.