By: Kayla Rodgers, Contributing Writer
Hollywood — The COVID-19 pandemic has left many unknowns about the future of the real estate market in Los Angeles, but so far it seems largely unaffected.
It has been five months since the beginning of the initial statewide shutdown in March, and demand for entry-level and luxury real estate remains healthy.
“Although there are some unknowns in real estate’s future, it has been quite busy for realtors and agents. A lot of people are buying and looking for deals because the luxury market is not affected,” said Drake Goosby, a luxury real estate appraiser with 20 years of experience.
There was a slowdown in overall sales at the beginning of the pandemic, according to the Los Angeles Times. Yet home prices were still high overall, and so far remain at that level, according to Goosby, who observed real estate prices decreasing slightly from an average of $1.96 million to about $1.8 million for a single-family home.
The coronavirus’ effect on Los Angeles real estate is different than what happened during the 2008 recession, Goosby added. Around that time, financial institutions relaxed their lending standards to extend credit to people who were not ordinarily qualified for mortgages. Home prices inflated to levels that many could not afford. The housing market crashed, in large part, because Americans couldn’t pay back those loans.
It’s a different story today. Homebuyers in Hollywood and West Hollywood consist of a lot of young, newly wealthy professionals, who are into more modern-style living, according to Goosby. They tend to work in the tech or entertainment industry.
Currently, real estate in LA is a seller’s market, according to Sally Forster Jones, a real estate broker with over 30 years of experience.
Jones oversees listings that range from what she defines as entry-level luxury, or homes selling in the high hundreds of thousands of dollars, to super luxury, or homes selling in the tens to hundreds of millions. Due to COVID-19, a lot of initial shopping for properties starts online. Prospective buyers then go to open houses to verify what they saw on their computers or phones before putting in their offer.
Jones encourages people to buy right now, because of low interest rates for both entry-level and ultra-luxury homebuyers.
“It is more competitive for a buyer right now and buyers need to act quickly if they see something they are interested in. COVID-19 has changed how buyers seek properties and brokers, speeding up the process in that sense.”
Photo credit: A luxury listening A luxury listing at 1471 Forest Knoll Drive, Hollywood by Mike Kelley & listed by Sally Forster Jones, Tomer Fridman & Tyrone Mckillen.
