The pandemic has had big negative affects to the economy in general, in real estate it has created a boom. How come?
Important Factors causing the apparent meteoric market response:
Crazy low interest rates push below 3%
Big industry winners like content providers, grocery sales, internet retail sales
Working from home increasing demand for larger space
Migration from high density to low density neighborhoods
Migration from high cost housing to low cost housing
Low housing stock
Los Angeles City Basin of single family homes is out wieghing the rest of the county; meaning that the increased higher value homes is factoring into the county statistic dramatically. Many areas outside of the LA basin is not achieving such dramatice increases. For the most part houses sold outside of the LA basin market are increasing 3-9% compared to the LA Basin's 28% increase. Also, we are seeing larger homes are selling more than usual which these numbers don't reflect. Buyers today are also more discerning and the inventory is reflecting the shift towards quality, making the turnkey product selling at above list prices. Continued improvement in the economy is critical to be able to sustain these value gains and market activity.