By Jeffery Marino
The latest home-sales data for Northeast Los Angeles, covering the month of August, give an especially clear picture of the market for residential real estate. That’s because home sales began to recover from the pandemic-induced slump in August 2020, making year-over-year measurements from August 2020 to August 2021 a good indication of market activity.
In contrast, year-over-year measurements from March-July 2020 to March-July 2021 were quirky because the 2020 starting points for the comparison were unusually depressed.
So what do the data from August 2020 to August 2021 show?
For starters, new listings of homes for sale in NELA were flat (-0.7%) in August 2021 compared to last year. But inventory fell by 24% because buyers snatched up anything and everything for sale, In August 2021, the median days on market for a house in NELA was 33 (nine days faster than in August 2020).
The combination of flat listings, frenzied buying and falling inventory translated into a 21% year-over-year increase in home sales in NELA in August and a 13% year-over-year increase in the median sale price of a NELA home, to $1.05 million. NELA home prices have now shown double-digit annual price growth for seven consecutive months.
Strong buyer demand in NELA can also be seen in the sale-to-list ratio, which measures the difference between the list price and the sale price of a house. At 108% in August, the ratio was about the same in August as it was in July, but six percentage points higher than it was a year ago.
In short, the market is behaving as markets do when demand exceeds supply.