Los Angeles luxury brokers increasingly talk of the pent-up demand for home buying that the coronavirus has created and how the pandemic has added to the L.A. market’s appeal.
But dig deeper, and even top agents express concern about how business will unfold during the public health catastrophe, economic tailspin, and nationwide reckoning with racism and law enforcement. And then there is the potential recurrence of the virus.
“I think everybody is now worried about a second wave,” said Westside Estate Agency principal Stephen Shapiro. He spoke at Thursday’s TRD Talks Live panel discussion with Hilton & Hyland’s Rayni Williams, Coldwell Banker’s Jade Mills and Rodeo Realty’s Josh Flagg. TRD Associate Publisher Hiten Samtani moderated the poolside chat at Flagg’s Beverly Hills home.
Williams predicted a flurry of deals in July and August, as L.A. County’s economy further opens up and its cultural scene reemerges. But she added that an active summer of home buying could be followed by another lull, which would have nothing to do with current concerns.
“Historically speaking, elections are always bad,” she said, and sales could “plummet in November.”
The poolside gathering was an escape from a city that has been rocked by the virus and recent demonstrations against police brutality and for racial justice that followed George Floyd’s killing at the hands of Minneapolis police.
Williams said the current political and economic situation has made her warn against the “flashy, over-the-top marketing” of luxury homes popularized by the likes of Nile Niami and other spec home developers.
You don’t want videos of “girls playing in the pool,” Mills added.
Agents echoed the pitch they have been giving throughout the pandemic: That the space L.A. affords homeowners compared to New York City makes it more of a draw.
“I think people are feeling that we are safe here,” Mills said, referring to the potential to contract the virus. While New York was the epicenter of the outbreak in the U.S., L.A. has experienced a recent uptick in cases.
L.A. has seen a recent surge in high-end condo tower construction, with several megaprojects in Downtown and in Century City, like Greenland’s Metropolis and Michael Rosenfeld’s Century Plaza.
But these brokers were skeptical of those projects’ potential for success.
“We don’t move to Los Angeles to live in a condo,” Flagg said.
Overall, Williams and Shapiro acknowledged matching up buyers and sellers has presented new challenges during the pandemic — which also included virtual-only home showings for a time.
“The buyers are out there,” Williams said. “But it’s very laborious and hard to transact.”
Shapiro said he reviewed MLS data and found that L.A. County condo sales were down 70 percent year-over-year.
“There is pent-up demand,” he added. But “it is not at the price sellers are asking.”