Southern California Real Estate Market Trends

Gardner-Report_masthead

Q1

2021

w-angle-pattern-bar-desktop-light

Our Southern California real estate market data is updated quarterly to aid in your real estate forecasts. Historical California real estate data and trends are included below the latest update. We break down our data by county, but we cover major cities in the SoCal area including Los Angeles, San Diego, Riverside, and Anaheim.

windermere-icon

Q1 2021 Gardner Report

Southern California
Real Estate Market Update

by Matthew Gardner

Below is the latest Southern California housing market trends analysis. Additional links:

Historical Southern California Data
Northern California Data
Hawaii Data
Other Regional Data

 

The following analysis of the Southern California real estate market is provided by Windermere Real Estate Chief Economist Matthew Gardner. We hope that this information may assist you with making better-informed real estate decisions. For further information about the housing market in your area, please don’t hesitate to contact your Windermere Real Estate agent.

 

Regional Economic Overview

The job recovery in Southern California can best be described as frenetic. Following the loss of more than 2 million jobs due to the pandemic, employers started rehiring last summer. That momentum was lost in the fall, but the latest data shows almost 400,000 jobs returned in February. As of penning this report, the region has recovered 1.3 million of the jobs that were lost, but that still leaves total employment down 700,000 from its pre-pandemic peak.

As jobs return, we see the unemployment rate gradually drop. The current rate is 10.9%. The latest data available showed the lowest jobless rates were in Orange County (6.8%) and San Diego County (7.2%). The highest rate was—unsurprisingly—in Los Angeles County, where it was 10.9%. In aggregate, the counties contained in this report have not seen a recent spike in new COVID-19 cases. As long as levels do not start to spike again, I expect to see more businesses reopen and demand for workers rise again.

southern california Home Sales

❱ The housing market remains remarkably robust, with 42,029 home sales in the first quarter of 2021, representing an increase of 20.1% year over year.

❱ Pending home sales, which are an indicator of future closings, were 5.0% higher than in the fourth quarter. This suggests that closings in the second quarter will be positive.

❱ The growth in sales was widespread, with all markets showing impressive double-digit gains. Of note is that Orange and Los Angeles counties saw sales rise by more than 20%.

❱ Listing activity was disappointing, with only 13,885 homes for sale in the first quarter of the year. This is 42.5% lower than a year ago and 27.7% lower than in the fourth quarter of 2020.

A bar graph showing the annual change in home sales for various Southern California counties.

southern california Home Prices

A map showing the real estate market percentage changes in various Southern California counties.

❱ The average sale price in the region was $870,038. This was 17.5% higher than a year ago and 4.6% higher than in the fourth quarter of 2020.

❱ Mortgage rates have started to rise, but this has not yet influenced the rapid pace of price appreciation. With prices rising faster than incomes, affordability concerns continue to grow.

❱ The region saw double-digit price growth across all counties contained in this report, with significant increases continuing in Riverside County as buyers move out of the L.A. area.

❱ Mortgage rates and high home prices relative to incomes are likely to lead to a slowing in price growth. That said, with a limited number of homes for sale and solid demand, prices in the Southern California market will, again, rise at rates that are above the long-term average in 2021.

A bar graph showing the annual change in home sale prices for various Southern California counties.

Days on Market

❱ In the first quarter of 2021, the average time it took to sell a home in the region was only 27 days. This is 18 fewer days than a year ago but matches the pace of the final quarter of 2020.

❱ All markets contained in this report saw the time it took to sell a house drop compared to the first quarter of 2020.

❱ Homes in San Diego County continue to sell at a faster rate than other markets in the region. In the first quarter, it took an average of only 19 days to sell a home in that market. This is 11 fewer days than it took a year ago.

❱ The drop in market time is a function of limited inventory levels in concert with significant demand.

A bar graph showing the average days on market for home in various Southern California counties.

Conclusions

A speedometer graph indicating a seller's market in Southern California.

This speedometer reflects the state of the region’s real estate market using housing inventory, price gains, home sales, interest rates, and larger economic factors.

Home sales and prices remain impressive, and demand continues to be very strong. These conditions favor home sellers; therefore, they are still in control of the market. While I expect the number of listings to rise this year, as well as a modest increase in mortgage rates, the market will remain tight.

Even as we see financing costs rising, I have still chosen to move the needle a little more in favor of sellers, as demand is likely – at least for the time being – to continue to exceed supply.

 

About Matthew Gardner

Matthew Gardner - Chief Economist for Windermere Real Estate

As Chief Economist for Windermere Real Estate, Matthew Gardner is responsible for analyzing and interpreting economic data and its impact on the real estate market on both a local and national level. Matthew has over 30 years of professional experience both in the U.S. and U.K.

In addition to his day-to-day responsibilities, Matthew sits on the Washington State Governors Council of Economic Advisors; chairs the Board of Trustees at the Washington Center for Real Estate Research at the University of Washington; and is an Advisory Board Member at the Runstad Center for Real Estate Studies at the University of Washington where he also lectures in real estate economics.

w-angle-pattern-bar-desktop-dark
w-angle-pattern-bar-mobile-dark

Major So Cal cities covered in this report:

Los Angeles

San Diego

Long Beach

Anaheim

Santa Ana

Riverside

Chula Vista

Santa Clarita

San Bernardino

Garden Grove

Huntington Beach

Moreno Valley

Glendale

Irvine

Fontana

Lancaster

So Cal counties covered in this report:

Los Angeles

Orange

Riverside

San Bernadino

San Diego

w-angle-pattern-bar-desktop-dark
w-angle-pattern-bar-mobile-dark

Gardner Report Archive

Southern California
Historical Reports

2021
Q1 2021 Southern California Market Trends

Q1 2020
POST | (PDF)

2020
                    Southern California Real Estate Market Update

Q1 2020
POST | (PDF)

                    Southern California Real Estate Market Update

Q2 2020
POST | (PDF)

                    Southern California Real Estate Market Update

Q3 2020
POST | (PDF)

Q4 2020 Southern California Market Trends

Q4 2020
POST | (PDF)

2019
                    Southern California Real Estate Market Update

Q1 2019
POST | (PDF)

                    Southern California Real Estate Market Update

Q2 2019
POST | (PDF)

                    Southern California Real Estate Market Update

Q3 2019
POST | (PDF)

                    Southern California Real Estate Market Update

Q4 2019
POST | (PDF)

2018
                    Southern California Real Estate Market Update

Q1 2018
POST | (PDF)

Q2 2018
POST | (PDF)

                    Southern California Real Estate Market Update

Q3 2018
POST

                    Southern California Real Estate Market Update

Q4 2018
POST | (PDF)

2017
                    Southern California Real Estate Market Update

Q1 2017
POST | (PDF)

                    Southern California Real Estate Market Update

Q2 2017
POST | (PDF)

                    Southern California Real Estate Market Update

Q3 2017
POST | (PDF)

                    Southern California Real Estate Market Update

Q4 2017
POST | (PDF)

These Southern California real estate reports, data, forecasts, and market trends are provided for informational use. If you find it useful, please properly attribute this resource with a link. This region of California is also referred to as SoCal, LA, LA Metro, OC, and Silicon Beach.