California Experiencing Major Real Estate Boom

The Golden State is one of America’s most attractive places to live. California has it all. Great weather, beaches, a massive economy, and some of the nicest and most luxurious real estate money can buy. Following a rocky 2020, 2021 has marked a stabilization for California. With the end of lockdowns, a massive vaccination rollout, and a return to normalcy, California’s shine is back.

California is America’s most populous state, with several major metropolitan areas, each with unique real estate trends. While the general trend of 2021 has been positive in the state, each of California’s most important markets is unique. Let’s look at some of California’s biggest and best-known real estate markets and dive into how they are performing.

Los Angeles

Los Angeles is California’s biggest city. It is a city of celebrities, beaches, and hilltop mansions. In 2020, Los Angeles was hard-hit by the pandemic. Tight lockdowns, social unrest, and a general sense of unease led to think pieces touting the end of California’s decade-long run as America’s most potent state. However, the numbers never backed that up, and 2021 has shown that Los Angeles is still the powerhouse it was before the pandemic started.

According to the Los Angeles Times, July 2021 was a record-setting month that showed Los Angeles real estate market is continuing to thrive. Los Angeles County set a new record with a median sales price of $795,000. This was an 18.7% increase from June, and even as prices climbed, so too did sales. Sales rose 20.2% in July, a massive leap. In August of 2021, according to a report by Redfin, the 2,591 homes sold were an 11.9% increase from August 2020.

San Francisco

San Francisco is one of the world’s most expensive real estate markets, if not the most expensive real estate market. Because of its proximity to Silicon Valley and an influx of money and opportunity, San Francisco’s real estate prices have surpassed reason. 2020 was a year where those skyrocketing prices stopped shooting upwards and began to decline. With work from home, many people didn’t feel the need to pay a considerable premium to be close to their workplace if they didn’t have to.

2021 has marked a return to form for the real estate market in San Francisco. Now shooting back to pre-pandemic levels, San Francisco is still the real estate juggernaut it was before. According to Redfin, in April and May of 2020, only 229 and 222 homes were sold in San Francisco. This was the lowest number of any months in the past five years. Since then, the market has begun to recover, peaking at a five-year high of 824 in June of 2021. In August, the 589 homes sold were a 25.9% increase over August of 2020, and the median selling price of a home was an astonishing $1,500,000.

San Diego

San Diego is on the furthest South-West tip of California. It is a beautiful place to live with rolling beaches, fantastic nightlife, and a growing economy. San Diego’s real estate market is pricey, but the city has a lot to offer.

San Diego’s real estate market has been on an upward trend for many years now. After a brief stall from the pandemic, the pace the price of real estate in San Diego has risen has accelerated. According to Redfin, in August 2016, the median price of a home in San Diego was $523,500. In June 2021, the median sales price hit $795,000, a record high. In August, the median sales price went down to $766,000, which marked a 10% increase from August 2020.

Santa Barbara

Santa Barbara is a smaller California city with an appealing local culture. Featuring a bustling student life, great surfing, and tons of restaurants and bars, Santa Barbara is an excellent option for those looking to live outside of the significant metropolitan California areas.

While Santa Barbara is smaller, it is by no means less expensive than the bigger California markets. While Santa Barbara has always been costly, 2021 has seen an explosion in the price of real estate in Santa Barbara. According to Redfin, every single month in 2021 has had a median sales price higher than the peak price of the previous four years. In August, the median sales price was $1,430,000, a 2.3% increase from August of 2020. Every month from June onwards, the median price has decreased but remains astronomically high.

Sacramento

Sacramento is California’s capital and compared to the other cities on this list, it is an affordable place to live. It is known for its delicious and fresh local food and its local hipster culture. It is a growing city with a lot to offer, and its real estate market is rapidly growing to reflect the increasing demand.

Over the past three years, the market has grown a significant amount. According to Realtor.com, in August of 2018, Sacramento’s median home sale price was $325,000. In July of 2021, the median home sales price was $450,250. This is an increase of a massive percentage in a short period, reflecting an increase in Californians willing to buy into Sacramento’s growth. The median amount of days homes spend on the market has also dropped dramatically from a 2019 peak of 70 to the current July 2021 number of 40.

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