In February, Southern California home prices increased by 0.3% to an average of $874,382, marking the first rise after seven months of decline. Factors such as high home values and elevated mortgage rates had hindered potential buyers, creating a stagnant market. However, a slight drop in mortgage rates coinciding with this uptick may suggest a shift heading into the busy spring season. Despite this, experts believe mortgage rates will remain stable, and more homeowners are opting to sell, contributing to an increase in available listings. Zillow projects a meager increase in home prices by 2026.
The average home price in Southern California rose 0.3% from January to $874,382 in February, marking a surprising increase after months of decline.
Despite the uptick in February, economist Orphe Divounguy cautions that mortgage rates are unlikely to decline significantly, which may temper buyers’ enthusiasm in the housing market.
Existing homeowners are opting to sell more frequently, leading to a 32% increase in homes for sale in L.A. County compared to February 2024.
Zillow predicts only a modest 0.1% increase in home prices across Los Angeles and Orange counties by February 2026, suggesting limited upward momentum in the market.
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