California’s Real Estate Revival: Buyers Are Back in the Game!

The Sidelines Are Empty—Buyers and Sellers Are Making Moves

Good news for California home buyers and sellers—February brought some serious momentum to the real estate market! Home sales across the state hit their highest point in over two years, thanks to lower mortgage rates and a fresh wave of buyer activity. The increase in transactions signals that many buyers who had been waiting on the sidelines are finally making their move, encouraged by improved affordability and a more favorable market environment.

“California home sales rebounded strongly in February after a sluggish start to the year, supported by increased buyer activity and more available homes on the market…Lower borrowing costs made homeownership more accessible to buyers who were previously sidelined by affordability challenges, while the rise in available inventory will help ease some of the competitive pressures that have defined the market in recent years and set a positive tone for the market for the rest of the year.”  said C.A.R. President Heather Ozur, a Palm Springs REALTOR®.

Home sales surged 11.6% from January and were up 2.6% compared to last year. That’s the best we’ve seen since October 2022! While we’re still waiting to break back above the 300,000 annual sales mark, this uptick is a solid sign of renewed interest in homeownership. Buyers are taking advantage of slightly lower mortgage rates, and sellers who were hesitant to list are now feeling more confident about entering the market.

Lower borrowing costs helped bring more buyers into the game, and a growing number of homes for sale made it easier to find the right fit. However, the market isn’t completely out of the woods yet—mortgage rates remain a wildcard, and economic uncertainty could keep some buyers cautious. With inflation concerns still present and potential Fed policy changes on the horizon, fluctuations in borrowing costs could influence market activity in the coming months.

“The moderation in mortgage rates that began at the start of the year, coupled with a noticeable increase in homes for sale last month, provided a much-needed boost to California’s housing market in February… Although sales are still below historical averages, this increase marks an encouraging shift in the market. Despite ongoing economic and policy uncertainties, mortgage rates are expected to stabilize later this year. As a result, the housing market is likely to see continued improvement through the second and third quarters of 2025.” said C.A.R. Senior Vice President and Chief Economist Jordan Levine

February’s median home price kept its 20-month streak of year-over-year gains, although the increase was smaller than in previous months. Prices dipped slightly from January, but that’s typical for this time of year. Historically, prices tend to soften during the winter before bouncing back in the spring. Expect a shift soon—spring and summer tend to push prices back up as homebuying season kicks into high gear, bringing increased competition among buyers.

Bottom line? The market is moving, and whether you’re thinking of buying or selling, now’s the time to stay informed, watch the trends, and be ready to make your move!

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

Single family homes  |  Los Angeles County | February 2025

New Listings: 3,954 (Up 9.05% year over year)

Homes Sold: 2,287 (Up 3.11% year over year)

Median List Price: $999,500 (Up 5.35% year over year)

Median Sales Price: $1,029,000 (Up 8.32% year over year)

Median Days on Market:  21 (Up 23.53% year over year)

Average List Price: $1,579,112 (Up 11.11% year over year)

Average Sales Price: $1,573,617 (Up 11.94% year over year)

Average Days on Market: 41 (Up 7.89% year over year)

List/Sell Price Ratio: 100.9% (Down .16% year over year)

Condo homes  | Los Angeles County | February 2025

New Listings: 1,623 (Up 9.66% year over year)

Homes Sold: 890 (Up 4.95% year over year)

Median List Price: $725,000 (Up 10.02% year over year)

Median Sales Price: $720,000 (Up 8.27% year over year)

Median Days on Market: 31 (Up 40.91% year over year)

Average List Price:  $980,759 (Up 24.58% year over year)

Average Sales Price: $958,600 (Up 22.05% year over year)

Average Days on Market: 51 (Up 21.43% year over year)

List/Sell Price Ratio: 99.4% (Down 0.71% year over year)