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Are prices in Southern California Up or Down?

  • lorette2000
  • May 29
  • 4 min read


MARKET UPDATE WITH ADVICE FOR BUYERS AND SELLERS
MARKET UPDATE WITH ADVICE FOR BUYERS AND SELLERS

I'd like to write on this topic since I see so much mis-information or information that pertain to the whole country on average, therefore is misleading for specific markets.


In coastal Southern California, the market is generally stable. What this means for a seller, selling a standard house:

  • If you price your house per the most recent comparable sales, you will receive offers in that price range.

  • If you price your house under market (under most recent comparable sales), you'll receive multiple offers and you will sell around market or, if you have gone out of your way to make your house look good, through staging and landscaping, maybe sell over asking price.

  • If you price over recent comparable sales, your house will sit on the market with, in some cases, no showings or otherwise no offers. Buyers will wait and see if you are going to drop the price. If you don't, you'll start getting low-ball offers, especially when the "Days On Market" get over 30 days. So if you want to test the market and list high, have a strategy in place, so that you adjust the price if you have no showing request in the first 10 days. Also adjust the price if you have showing request in the first 10 days, but no offers. If you do this fast enough, you can sell for market value. If you are too slow to adjust your price, you'll more than likely end up getting less than market value for your house.


The exception to this general statement is if the house you are selling is exceptional:

  1. Is this a "view" property? View of a lake, the ocean, an exceptional mountain view?

  2. Does your property have an exceptional location? Maybe not a view, but in a great school district, or walking distance to an arts district in a downtown area...

  3. If the property you are selling has been completely renovated in the last couple of years and looks spectacular. Buyers love completely redone, or new homes and will pay a premium.

    In these last cases, sellers can still get above market prices.


Then why are we seeing so may price drops, even in Southern California?

The biggest reason is that many listings during the last part of 2024 and the first quarter of 2025, came on the market in a period where sellers still thought the market was still a strong sellers market and that prices were still going up. So instead of pricing properties per the recent comparable sales, sellers priced their homes for what they thought they should get, based on how much prices were appreciating yearly in the last few years.

So yes, there were price adjustments, but really, the adjustments are bringing the prices to market levels, not below market (per recent comparable sales).


Advice for Sellers:

Discuss your pricing strategy with your agent and know what to expect. Do not price your house for "wishful thinking" price.


Advice for Buyers:

It is true that a lot more listings have come on the market between January and May of 2025.

And that some of the properties are still sitting on the market.


One thing to remember for buyers, who have been sitting on the sideline to see if prices and/or rates are coming down, is that there are many, many others just like you, who have been sitting on the sidelines. So when a good property, or an OK property in a great area, comes up, there are more buyers than previous years, who are ready to make offers. In those cases, we are still seeing multiple offers and prices going over asking.


I am not seeing any great deals to be had in coastal Southern California, or rather, I think great deals are properties priced right, per recent comparable sales in a good neighborhood. I advise buyers to look for those type of properties and buy them.


There is one way you will get a good deal on a house, is if you are willing to put in the work. Look for properties that have been sitting on the market for over 100 days, or houses that have some deferred maintenance but that are in a good area. More than likely, there will not be multiple buyers who are waiting to make offers on these type of properties.


Most buyers these days are looking for "turnkey" homes, remodeled or new-built homes, so that they can move right in without doing anything. So if you are the one who is willing to put the work into a property that has potential, that is where you can still get a deal in Southern California.

And if you are able to pay cash for such a house, you will get an even better deal.


With more properties coming on the market and many buyers who have been waiting in the wings, this market seems to be picking up steam. Be informed, talk to your agents and good luck, whether you are buying or selling!


  • Lorette Murphree, Broker, So Cal Dwell, Seal Beach,

    CA license 01271840, 562.397.1735




 
 
 

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