CALIFORNIA — Coronavirus has touched every corner of life in California, and the real estate market is no exception. Some might think home prices would be low due to the pandemic — but instead, you couldn't be further from the truth.
"Buyers think because we're in the midst of COVID-19, they should be able to get a deal, but it's actually the opposite," said Compass realtor Liz Jones. "There's competition. That doesn't mean there's a deal, if you have multiple people interested, it tends to raise the price.
Jones also said the inventory of attractive homes is lower than it's been in at least 10 years, which has fueled that competition and kept prices high. According to data from DQNews, November's median home price in Southern California was $603,000, nearly 11 percent higher than the median price in 2019.
It's been a similar story for the past several months. September's median price of $610,000 across Southern California set a new record. Mortgage rates have remained low, however, motivating buyers with the capital to pull the trigger on a new home.
The impact of coronavirus goes deeper than just prices, though — it's also changing what people value in their new living space.
"People are wanting multiple office spaces, not just the one," she said. "Different places to gather, you might want the kids to have a TV room over there, and then the family over here, seperate areas are really important. And outdoor living is really important... can you have tables, and heat lamps, and pools? Any house with a pool has been going super fast."
Jones has also seen an influx of people wanting to move to California for the weather, although that's been somewhat offset by people leaving the state in search of lower taxes and other benefits. Within Los Angeles, residents of westside communities like Venice and Santa Monica have been increasingly interested in relatively quiet areas like Brentwood and Pacific Palisades, seeking more room and less noise.
Although current demand has skyrocketed, that wasn't always the case throughout the pandemic. Jones noted how real estate wasn't initially classified as an essential service, causing their traditionally high spring market to be eerily quiet.
"We were all wiping our packages down, nervous about going to the grocery store," Jones said. "Looking at houses made people nervous."
That build-up eventually boiled over during the summer, as buyers looked to make up for lost time and upgrade to nicer quarters. Another side-effect of stay-at-home orders: people had less patience for significant home improvement efforts, prioritizing how quickly they could finish the moving process rather than waiting to build their dream house from the ground up.
"People have been stuck in their homes for so long now, they’re all very aware of the downfalls of their own homes, and they want something different," Jones said. "Construction rates have gone up, there’s a delay in appliances and getting permits, so the building is not as exciting as it was a year ago. They want move-in ready, the perfect house they can move into and say ‘okay, we’re happy here.’