Low inventory and few days on the market: housing in the IE
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When I checked on the region’s real estate market over the summer, inventory was low, houses were being sold extremely quickly, and a large percentage of homes throughout California were going for way above asking price.
All three of these metrics no major change - this is still a red-hot housing market. Both inventory and median days on the market have increased slightly since Spring 2021, but they are still at historic lows.
Data are from the California Association of Realtors (source). Aside from the small increase in July and August, there are three takeaways from this graph:
Median days on the market are not just low today; they are at historical lows (even relative to the mid-2000s market!)
No major differences in LA vs. IE or other parts of Southern California. The entire state’s “median days on market” continues to be low, and price appreciation remains high
Notice that the purple line (IE) used to hover above the yellow/green lines, meaning the IE market used to be “cooler” than other parts of SoCal; but that this is no longer true. Southern California housing markets have converged - no area is safe from the heat
Unsold inventory indexes paint a similar picture. After consistently trending downward since early-2019, the indicator has stabilized and might be increasing over recent months, but in a minor way. Also, notice again the convergence of unsold inventory across regions starting at the pandemic:
Finally, analysis from the California Association of Realtors (source) shows that the percent of homes sold above asking price continues to increase! I thought this metric would decline by now.
On this metric, as well as others in general, it is clear that things are far from slowing down. If houses are undervalued (according to this final graph), it means that even a slowdown in sales is not likely to push prices down.