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Southern California Is One of the Top Luxury Home Markets
July 6, 2021

Southern California Is One of the Top Luxury Home Markets

by The CE Shop Team

Dive Into These Luxury Oceanside Markets

Luxury homes are in high demand as wealthy homebuyers’ priorities shifted due to the COVID-19 pandemic. Instead of seeking thrills and chills in luxurious vacation markets, homebuyers decided to find luxury homes in areas that offered more space and recreational amenities. Bigger became better, the less-is-more trend was bucked, and social distancing became the social norm. Unsurprisingly, then, two of Southern California’s real estate markets placed in the top 10 luxury markets across the country — Los Angeles took second place, and San Diego nabbed third. In Southern California, the median home price has risen by double digits for eight consecutive months with no signs of slowing down. 

Luxury Home Markets in 2021

The intangible benefits of “home” became increasingly sought after as people re-analyzed their lifestyles during the pandemic. The value of a safe, secure abode that ticks all the boxes has become more important than ever to homebuyers, and it's times like now that clients should know where the market stands. Fortunately for this niche market, cost is not typically a deterrent. These affluent clients put a lot of value in how they plan to use a home and take into account their family’s needs, and they’re willing to pay whatever it costs to secure their personal palace. Let’s take a look at the local markets where luxury homebuyers (and their agents) thrive — specifically, Los Angeles and San Diego.

Los Angeles’ Luxury Market

The pandemic pushed many of Los Angeles’ high-net-worth homeowners out of the city, causing them to search for greener, more spacious pastures. Buyers wanted property that would provide privacy for their family and friends. This new trend is slowly changing the city’s layout; though it once modeled New York’s high rises, properties are spreading out into horizontal living. The median home price rose nearly 23% compared to last year, with homes selling for an average of just under $920,000. 

“The outdoor lifestyle is why people pay to live in Los Angeles,” said Cindy Ambuehl, a real estate agent with Compass in Los Angeles, in an interview with Forbes. “More than anything, they want to be able to breathe and to enjoy the gorgeous weather.”

The gorgeous weather isn’t the only thing that’s hot. One of Ambuehl’s listings, a home on three acres in Mandeville County, sold for $1.8 million over the asking price of $3.7 million — and this heatwave extends all over Los Angeles. Markets like Malibu are thriving, welcoming waves of new residents from the L.A. metro area. The median home price in Malibu has risen 126% year-over-year to a median selling price of $4 million.

Now that we’ve unpacked Los Angeles’ luxury market, let’s head down south and explore America’s Finest City.

San Diego’s Luxury Market

San Diego’s housing market is currently one of the hottest in Southern California. Often overlooked, San Diego’s recovery from the pandemic outpaced the state as a whole, including Los Angeles and San Francisco. As luxury buyers looked for more land outside of urban areas, markets like San Diego became very competitive. Now becoming a tech hub, this Southern California county has been booming for the last decade, standing out for its affordability and growing job market. 

“I have been selling real estate since 1981 and I’ve never seen it like this,” said Jan Ryan, a RE/MAX agent based in Ramona.

The median home price in San Diego rose 19% compared to last year to $764,000. The number of homes sold has increased by 97% year-over-year, highlighting the San Diego market’s appeal. In San Diego’s luxury market, homes listed at $2 million+ dropped from an average of 277 days on the market to just 109 days. Clearly, the county has become a hot spot for affluent buyers looking for bigger properties. 

Southern California Luxury Real Estate

Luxury Real Estate Market

Are you daydreaming about breaking into hot, niche markets like these? Becoming a luxury real estate agent isn’t impossible, but it does take a lot of hard work and dedication to serve clients whose time is quite literally money. Understandably, then, mastering this market requires significant patience and a solid work ethic. Each property is unique, and it requires vision to highlight the one-of-a-kind features found in the home. It’s also worth noting that, while the commission checks tend to be larger for luxury real estate agents, they’re also less frequent. These glamorous homes often appeal to a smaller audience who typically take years to locate and then successfully navigate the purchasing process.

If you’re interested in becoming a luxury real estate agent, we have a guide to help you break into this lucrative niche here.

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