Main Content

Home Sales Slow Down, Indicating the Market Has Hit Its Price Cap

The Real Deal

Everything Real Estate in the San Fernando Valley
Monday July 26, 2021
Home Sales Slow Down, Indicating the Market Has Hit Its Price Cap

In June 2021, the volume of new home sales dropped to its lowest level since the onset of COVID-19 in early 2020. The common consensus is that low inventory and sky-high prices are forcing the market to adjust. Of course, this was inevitable; when inventory is low, prices will continue to climb until they reach a point that the consumer is unwilling to pay.

According to the U.S. government, new home sales decreased by 6.6% in June 2021, which is far more significant than the experts had predicted. To be fair, the Midwest saw sales increase, but the rest of the country saw a decrease. In January 2021 (when pricing was a little less competitive) new home sales reached a 15-year high. While demand for homes remains high, it appears many willing buyers have been priced out of the market; homes are about 12% more expensive than they were in June 2020.

The slowdown is anticipated to continue in the following months and may have a snowballing impact on inventory; many people will not sell their homes because they aren’t comfortable buying another home to move into.

It’s always good to note that real estate trends around the country often don’t apply to Los Angeles and the market here is certainly hot!

At the Chernov Team we understand that knowledge is power, and knowledge of how the rate of home sales compares to previous datapoints is powerful knowledge indeed. At the Chernov Team we know that whoever comes to the table most prepared leaves with the most, and the Chernov Team always leaves the table with the most.

08

Stay Connected

Sign up to Access:

Exclusive private listings S.F. Valley market insights VIP events

    Thanks for signing up!
    By signing up you agree to our Terms & Conditions

    More Blog Posts

    To Love
    Monday September 20, 2021

    On September 16, 2021, Governor Newsom signed one of four planned bills directed at enabling housing construction i...

    Read Full Post
    Tuesday September 14, 2021

    Since the onset of the pandemic a year-and-a-half ago, sellers have been a lot like the Los Angeles Dodgers – the...

    Read Full Post
    Friday September 3, 2021

    For the sake of not rocking the boat, let’s put aside the question of what is causing climate change and simply a...

    Read Full Post
    Monday August 30, 2021

    On Thursday, August 26, 2021, the Supreme Court of the United States (“SCOTUS”) struck down the Biden Administr...

    Read Full Post
    Tuesday August 24, 2021

    On August 23, 2021, the National Association of Realtors (“NAR”) reported that existing home-sales rose 2% betw...

    Read Full Post
    Monday August 16, 2021

    The new construction sector of the housing market has been seeing positive signs. To briefly recap, the cost of lum...

    Read Full Post