A quick note from us
This week, rising tensions in the Middle East caused oil prices to climb, renewing concerns that inflation may remain stubbornly high. Mortgage rates finished near their highest levels in roughly one year, reflecting these inflation worries. June's existing home sales slipped slightly from May but were still 3% higher than a year ago, with the median price reaching a record $440,600. Inventory remains tight nationally at a 4.6-month supply, below the balanced market level of six months. On the labor front, jobless claims unexpectedly dropped to the lowest level since the 1960s, indicating continued labor market resilience despite some signs of slower hiring. Builders face challenges with rising costs and affordability, as single-family starts declined for the third consecutive month and builder sentiment remains negative.
What this means for buyers: Buyers in Los Angeles should prepare for mortgage rates that remain elevated due to inflation pressures and tight housing supply. While prices are at record highs, limited inventory means competition remains strong. Understanding current market dynamics and acting decisively will be key to securing a home.
What this means for sellers: Sellers can benefit from continued demand and low inventory, which support strong pricing power. However, rising mortgage rates may temper buyer enthusiasm, so pricing homes strategically and highlighting value will be important to attract qualified buyers.
Housing Market Activity and Inventory
In June, sales of previously owned homes nationally dipped slightly from May but were still 3% above last year’s levels. The median home price reached a record $440,600, up 2% year-over-year. Inventory remains constrained at a 4.6-month supply, well below the typical balanced market level of six months, although it is slightly higher than a year ago. This tight supply continues to support home prices despite rising mortgage rates.
What this means for buyers: Limited inventory means buyers in Los Angeles face competition and should be prepared to act quickly and competitively. Patience and flexibility may be required to find the right property.
What this means for sellers: Sellers benefit from low inventory and strong demand, which can help achieve favorable sale prices. Proper pricing and marketing remain critical to maximize value.
New Construction and Builder Sentiment
June housing starts rose 19% from May, driven entirely by multi-family units, while single-family starts declined for the third straight month. Single-family building permits fell to their lowest level since August 2025. Builder sentiment remains negative, with the NAHB index at 34, below the 50 threshold for 27 consecutive months. Rising land, labor, and material costs continue to challenge builders, leading many to offer sales incentives or reduce prices to stimulate demand.
What this means for buyers: New construction options in Los Angeles may remain limited and expensive, so buyers should consider existing homes as well. Incentives from builders could provide some opportunities.
What this means for sellers: Sellers of existing homes face increasing competition from new construction, especially if builders offer incentives. Highlighting unique features and value can help maintain buyer interest.
Labor Market Strength
Weekly jobless claims unexpectedly dropped to 187,000, the lowest level since the 1960s, signaling a resilient labor market. Despite some reports of slower hiring, companies remain reluctant to lay off workers, supporting consumer confidence and housing demand.
What this means for buyers: A strong labor market supports steady income and borrowing capacity, which can help buyers qualify for mortgages despite higher rates.
What this means for sellers: Labor market strength underpins housing demand, helping sellers maintain pricing power in Los Angeles.
Market Outlook and Upcoming Events
Attention remains focused on the Middle East conflict and any potential deal to ease tensions, which could influence energy prices and inflation. The Federal Reserve meeting on July 29 is expected to hold rates steady, with investors closely watching commentary for future policy direction. Key economic reports including Consumer Confidence, second quarter GDP, and the Core PCE inflation index will be released later this week, providing further insight into the economy and housing market conditions.
What this means for buyers: Buyers should monitor upcoming economic data and Fed signals, as these will impact mortgage rates and market conditions in Los Angeles.
What this means for sellers: Sellers should stay informed on economic developments that could affect buyer demand and financing availability, adjusting strategies accordingly.
Closing Remarks
Every buyer and seller enters the market with different priorities. For some, it is achieving the strongest possible price. For others, it is timing, certainty, or aligning the sale of one property with the purchase of another. In a market where mortgage rates are adjusting, inflation remains elevated, and new construction is increasing competition, strategy matters more than ever. The way a property is priced, negotiated, and managed from contract to closing can directly influence both your financial outcome and your timeline. The difference between a disciplined plan and a reactive one can equate to tens, and in some cases hundreds, of thousands of dollars. If you would like clarity on your home's value in today's rate environment, or a thoughtful plan for what you can confidently purchase as conditions evolve, we would welcome the conversation.
