I almost didn’t believe the stats, but after looking at it for a 3rd time, it’s real. Since October 2020, the median selling price in Palos Verdes Estates has grown by 49% from $1.88M to $2.8M (12 month moving average). In Valmonte, the number is even more staggering where the median price grew 62.5% from $1.6M to $2.6M in the same time period. But what does that mean moving forward? For those that aren’t planning to do anything different with their home, it’s all just gravy. If you are considering selling and you bought more than 2 years ago, you are likely to realize a fantastic gain on your investment. For those that are looking to buy, well, there isn’t much to choose from as I write this, in fact there aren’t any homes for sale in Valmonte, and Palos Verdes Estates has 20 homes on the market, so you’ll likely still pay a premium.
While this rapid appreciation may make the hair on the back of your neck stand up a bit, the reality is the PV market was largely undervalued until the pandemic. It’s certainly understandable to call it a bubble, but with that much equity, distressed sales are highly unlikely, and in fact, most home owners are less incentivized to sell when they either own the property free and clear, or have a low mortgage rate compared to today’s rates. This type of appreciation probably won’t be repeated, but we aren’t likely to see it crash either.