REAL ESTATE NEWS (Los Angeles, CA) — The numbers are in. Did urban L.A. property market go up or down last month compare to the same month last year? A mixture of both, as the more affordable units get more affordable, while the more expensive units get more expensive. It’s been taking longer to sell Downtown condos lately. These add up to signs of economic stagnation and price inflation, strongly affected by higher interest rates.
The Pulse of Progress: Downtown L.A.’s Real Estate Evolution
In the heart of Los Angeles, the real estate market has always been a beacon of change, reflecting the city’s ever-evolving skyline and the dreams of its residents. As we dive into the Downtown L.A. real estate market, a comparison between home sales in January 2024 and the same period in 2023 reveals a fascinating narrative of growth, challenges, and the unyielding pulse of progress.
A Year of Transformation
January 2023 set the stage with 15 condo and co-op properties changing hands, showcasing an average days on market (DOM) of 38 days. The listings ranged from a modest $373,000 to a lavish $1,568,000, with an average selling price slightly above the listed, indicating a market of close matches between buyer expectations and seller demands. The average price per square foot stood at $760.62, a figure that bespoke the premium on downtown living space.
Fast forward to January 2024, and the narrative took on additional layers. The number of listings sold rose to 19, a subtle yet telling increase reflecting the market’s resilience and appeal. However, the average DOM jumped to 64 days, hinting at a market that required more patience from sellers and more deliberation from buyers. The price brackets expanded as well, with the high reaching $1,645,000, although the median selling price remained steady, suggesting a consistent core market value amidst a widening range of options.
Analyzing the Numbers
The slight dip in the average selling price to list price ratio from 97.36% in 2023 to 97.01% in 2024 indicates a market that’s becoming slightly more favorable to buyers, offering them a tad more negotiation room. Yet, the decrease in the average selling price over the original list price ratio from 107.87% to 93.10% signifies a shift towards a market that’s aligning more closely with initial pricing expectations, possibly reflecting sellers’ adaptation to more accurate market valuations.
Notably, the average price per square foot experienced a decline from $760.62 in 2023 to $633.58 in 2024. This adjustment could reflect a variety of factors, including changes in the types of properties sold or variations in market demand. Yet, the increase in the average square footage from 775 to 1,035 underscores a trend towards larger living spaces, reflecting a market evolution that caters to a diverse range of buyer preferences and lifestyles.
Beyond the Numbers
The story of Downtown L.A.’s real estate market is not just told through numbers but through the lives that animate its spaces. The increase in the average lot size, from 80,283.50 square feet in 2023 to 92,249.11 square feet in 2024, hints at a broader canvas for the city’s architectural creativity and the residents’ aspirations.
As Downtown Los Angeles continues to morph, with its blend of historic charm and modern luxury, the real estate market mirrors this dynamism. The market’s shifts and trends are more than mere statistics; they are a testament to the area’s resilience, its capacity for renewal, and its unwavering attraction for those seeking to write their own stories within its vibrant landscape.
The Downtown Los Angeles real estate market’s journey from January 2023 to January 2024 is a microcosm of the city itself: diverse, dynamic, and ever forward-moving. It’s a market that demands attention, not just for its economic indicators but for what it signifies about urban living and the enduring appeal of calling Downtown L.A. home.
The most dramatic differences between January 2023 and January 2024 in the Downtown Los Angeles real estate market are seen in the significant increase in the average days on market (DOM) from 38 to 64 days, indicating a slower pace of sales, and the notable expansion in the average square footage of sold properties from 775 to 1,035 square feet, reflecting a shift towards larger living spaces. Additionally, the average price per square foot saw a decrease from $760.62 to $633.58, suggesting a market adjustment that potentially offers more value per square foot for buyers. These changes highlight a market in transition, adapting to evolving buyer preferences and market dynamics.
What about average sold price and median sold price? The average and median sold prices between January 2023 and January 2024 in the Downtown Los Angeles real estate market also reflect noteworthy shifts. The average sold price increased from $625,400 in January 2023 to $661,842 in January 2024, demonstrating a growth in the overall value of properties being sold. In contrast, the median sold price remained consistent at $578,000 across both years, indicating stability in the market’s central tendency despite the overall increase in average values. This consistency in the median sold price, paired with the rise in average sold price, suggests a broadening in the range of property values sold, with high-value sales driving up the average while the bulk of transactions centered around a steady median price point.
Did average price per sq ft go up or down? The average price per square foot in the Downtown Los Angeles real estate market went down from $760.62 in January 2023 to $633.58 in January 2024. This decrease suggests a market adjustment where buyers could find more value per square foot, indicating a potential shift in the balance between buyer demand and available property characteristics.
These numbers sound like stagflation, as the rich get richer and the middle class gets poorer. The trends observed in the Downtown Los Angeles real estate market from January 2023 to January 2024 indeed present a nuanced picture that could be interpreted through various economic lenses, including aspects reminiscent of stagflation. While the term “stagflation” is traditionally used in the broader economic context to describe a period of slow growth and high unemployment accompanied by inflation, some parallels can be drawn with the real estate market dynamics.
- Slowing Market Velocity: The increase in average days on market (DOM) from 38 days in 2023 to 64 days in 2024 suggests a slowing velocity in property transactions, akin to slowed economic growth.
- Price Inflation: The rise in the average sold price, despite a decrease in the average price per square foot, indicates that while there might be more value per square foot, the overall price levels are increasing. This could suggest a form of price inflation where higher-value properties (potentially appealing to wealthier buyers) are driving up average prices.
- Disparity in Value: The consistent median sold price alongside the falling average price per square foot could reflect a growing disparity in the market. This scenario might indicate that while the median (representative of the “middle class” of properties) remains stable, the average is skewed by high-end sales, suggesting that wealthier individuals are still investing in more expensive properties, potentially widening the gap between different market segments.
These dynamics can reflect a form of economic divergence within the real estate market, where the experiences and opportunities differ markedly between segments of the market. This interpretation aligns with concerns over economic disparities, where the benefits of certain economic conditions are not evenly distributed. However, it’s important to note that real estate markets are influenced by a multitude of factors including interest rates, supply and demand dynamics, and broader economic conditions, making the comparison to stagflation a conceptual rather than a direct correlation.
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Copyright © This free information provided courtesy L.A. Loft Blog with information provided by Corey Chambers, Broker DRE 01889449. We are not associated with the seller, homeowner’s association or developer. For more information, contact 213-880-9910 or visit LALoftBlog.com Licensed in California. All information provided is deemed reliable but is not guaranteed and should be independently verified. Text and photos created or modified by artificial intelligence. Properties subject to prior sale or rental. This is not a solicitation if buyer or seller is already under contract with another broker.