The prices of houses in southern California fell slightly in January because high mortgage rates continued to weigh on potential buyers.
The average price of houses in the six counties region decreased by 0.4% from December to $ 862,115 in January, according to Zillow, marking the sixth consecutive month of decline.
Prices are now 1.9% reduction on their level of all time in July, but some economists say that potential buyers and sellers should not expect the value of the houses to plunge – one of the reasons behind the change is that the market generally slows down fall and winter and prices are always greater than what they were a year ago.
However, more houses reach the market and mortgage interest rates remain high, creating a situation of a little more supply and slightly less demand.
As a result, annual prices growth has slowed down. Last month, the prices of houses in southern California were 3.9% higher than a year earlier. In April, prices were 9.5% higher than a year earlier.
Some economists say price growth should slow this year or remain stable, but a lack of supply will probably stop values to lower considerably.
Skylar Olsen, chief economist of Zillow, said that the January fires that torn the County of Los Angeles could exert higher pressure on the prices of houses because they have seriously damaged or destroyed more than 12,000 houses.
At the same time, if the cost of the insurance of a house increases following fires, this could make buyers of potential houses pay less.
For the moment, Zillow plans that the prices of houses in the combined metropolitan region of the counties of Los Angeles and Orange are essentially unchanged over the next year, down 0.2% between last month and January 2026.
Zillow Research, time analysis
Note to readers
Welcome to the Los Angeles Times Immobilier Tracker. Each month, we will publish a relationship with data on housing prices, mortgage rates and rental prices. Our journalists will explain what the new data means for Los Angeles and the surrounding area and will help you understand what you can expect to pay for an apartment or a house. You can read the ventilation of real estate from last month here.
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Rental price in southern California
In the past year, asking for rents for apartments in many southern California regions has checked, but the county's January fires could upset the downward trend.
Experts said that the increase in vacancy levels had forced owners to accept less rent, but fires have suffered thousands of houses, suddenly pushing many people on the rental market.
While these people were looking for accommodation, there were widespread reports on the tougeing illegal prices, some owners increasing rent by more than 50%.
The authorities have since filed several criminal and civil cases against owners and real estate agents, and it is not clear to what extent the larger market will be more competitive in the months and the coming year.
Most destroyed houses seem to be unified houses and that some experts say that they expect the highest rent increases to be in larger units to burning areas in the Pacific and Altadena palisades, with upward pressure on the cost decreasing as the units become smaller and more distant from the disaster zone.
January rent data gives an early overview of what could happen.
In Santa Monica, which borders the Los Angeles district of Pacific Palisades, the median rent increased by 2% compared to December to reach $ 2,501 in January, according to Apartmentist data.
Throughout the city of Los Angeles, which includes the palisades and many districts which are not adjacent to a fire, the median rent of the apartment dropped from 0.15% from December to $ 2,057.
Rob Warnock, analyst at Apartmentlist, warned the company data does not include unified houses and that, even in normal times, the rent can bounce around the month.
“I think it will take a few months to really know if the rents have a tendency differently as a result of fires,” he said in an email.
