Closing the Year with Confidence, California’s Housing Market Ends Strong

December Shows Positive Momentum, but Hurdles Remain

California’s housing market ended 2024 with a bang, with the largest yearly sales increase since June 2021. But don’t get too comfortable just yet — the market still has some growing pains to work through as we move into 2025.

December’s sales pace didn’t budge much from November, but it was up a striking 19.8% compared to the same time last year. The statewide median price saw a modest 1.0% monthly increase and a steady 5.0% year-over-year growth, marking the 18th consecutive month of climbing prices. This consistent growth hints at more price gains in the months ahead. Sure, seasonal trends may cause prices to take a breather, but don’t expect the climb to stall completely. Predictions for the first quarter of 2025 show year-over-year growth ticking along in the low single digits before the spring homebuying frenzy kicks into high gear.

One major driver behind these rising prices? California’s luxury market. High-end homes priced at $1 million and up enjoyed a December sales surge of 28.7% year-over-year, while the more budget-friendly sub-$500,000 market took a small dip of 0.4%. If the high-end segment keeps flexing its muscles, expect the state’s median price growth to hold steady as the year unfolds.

C.A.R. President Heather Ozur, a Palm Springs REALTOR®, summed it up best:

“California’s housing market ended the year with a positive note with home sales reaching the highest level in five months…With mortgage rates remaining at their highest level since early July and devastating wildfires taking a toll on the Southern California housing market, we’ll likely have a slow start for the year, but demand should pick up once we enter the spring homebuying season.”

As California closed out the year with a solid double-digit increase in sales compared to last December, the housing market is expected to continue improving in 2025. However, challenges like stubborn inflation, the ongoing insurance crisis, and policy shifts from the new administration could create some obstacles for the market in the year ahead.

“As projected, both sales and price activity were up modestly in 2024 as California wrapped up the year with a double-digit sales gain over last December… While the housing market is expected to improve further in 2025, stickier-than-expected inflation, the ongoing insurance crisis, and policy changes under the new White House administration are some of the hurdles that could present challenges for the market in the upcoming year.”

Bottom line? California’s housing market is proving its resilience, with high-end sales leading the charge. While challenges linger, the forecast for 2025 suggests continued growth and opportunity. The road ahead might have some bumps, but for now, it’s full steam ahead. Let’s buckle up and see where this ride takes us.

And now for the latest data on Los Angeles County real estate trends:

Single family homes  |  Los Angeles County | December 2024

New Listings: 2,009 (Up 1.67% year over year)

Homes Sold: 2,743 (Up 13.58% year over year)

Median List Price: $980,000 (Up 8.89% year over year)

Median Sales Price: $988,000 (Up 7.98% year over year)

Median Days on Market:  24 (Up 26.32% year over year)

Average List Price: $1,430,140 (Up 5.74% year over year)

Average Sales Price: $1,407,485 (Up 5.88% year over year)

Average Days on Market: 38 (Up 15.15% year over year)

List/Sell Price Ratio: 100.4% (Down .2% year over year)

Condo homes  | Los Angeles County | December 2024

New Listings: 857 (Up 8.07% year over year)

Homes Sold: 1,008 (Up 18.59% year over year)

Median List Price: $699,999 (Up 4.24% year over year)

Median Sales Price: $710,000 (Up 5.81% year over year)

Median Days on Market: 30 (Up 42.89% year over year)

Average List Price:  $874,879 (Up 9.97% year over year)

Average Sales Price: $870,043 (Up 9.96% year over year)

Average Days on Market: 44 (Up 22.22% year over year)

List/Sell Price Ratio: 100.1% (Up .24% year over year)