The sense of a market shift in our local residential real estate market has everyone talking. More price decreases than in months before, more days on market... more homes on the market... these are just some of the rumors. I believe in looking at the data, so let's examine what I believe to be the three most telling data points for the pace and direction of our market: inventory, price and days on market.
INVENTORY When we evaluate the ‘months of supply’ or ‘absorption rate’, this is the leading indicator of whether we have a Buyer’s Market or a Seller’s Market. As you can see, comparing the last 6 months of 2018 to the same time in 2017, we are seeing a slight increase in inventory, from .2-.6%, but overall inventory is still very tight, well below 2% across the board in Redondo Beach.
when there is more than 6 months of inventory
when there is less than 5-6 months of inventory
PRICE Across all areas of Redondo Beach, prices have continued to increase for years in a row. In the last two years to date compared to 2016, prices have risen by over 17% in North Redondo, up to over 23% in the “Villas South” area specifically, located south of Artesia. In 2016, median price to date was $839,250 compared to $1,050,000 in 2018.
DAYS ON MARKET As inventory rises, days on market tend to rise as well. Year to date, days on market in North Redondo has actually decreased compared to 2017. Simply put: demand continues to strongly outpace supply.
Take a look at notable sales closed in the last 90 days:
Nobel Prize winner and Yale economist Robert Shiller told CNBC in October he isn’t fearful that a big downturn is ahead. “During the financial crisis, the fluctuation of home prices was the sharpest anyone had seen — and the term ‘housing bubble’ entered the vocabulary. You can call it a bubble because home prices have been rising since 2012, but it’s not the same. It’s more placid.”
My crystal ball is already on vacation for the holidays, however if you'd like to discuss your thoughts, expectations and desires for the current or upcoming real estate market, I look forward to hearing from you. Happy Holidays!
[all market data from MLS as of 11/29/18]