It seems that in the Greater Los Angeles area’s absorption rate stats, what goes down must come up. January’s month of down-the-line decreases in absorption rates were countered in February with increases across the board. We had a similar surge in every neighborhood in March 2023. So, while it’s rare, it happens. And it was expected. We ended January’s absorption rate analysis confidently predicting that “February will likely see these absorption rates surge back up in the seller’s favor.” This was further fueled by the fact that we sold more homes in February than in January, despite fewer homes being on the market. So much for the pre-spring dead zone!
- Burbank – 38%
- Encino – 23%
- Glendale – 42%
- Long Beach – 43%
- Los Angeles – 25%
- Northridge – 51%
- Palmdale – 27%
- Pasadena – 39%
- Rancho Cucamonga – 46%
- Reseda – 39%
- Upland – 39% (
- Valencia-Santa Clarita – 30%
Now, before we dive into the specifics, let’s answer a few FAQs for the newcomers.
Absorption Rate FAQs
What is an absorption rate?
An absorption rate is a statistic that we can use in real estate to estimate whether a specific area favors home buyers or sellers. Universally speaking, an absorption rate of 18% or higher tends to indicate a seller’s market, meaning conditions favor the seller. Likewise, absorption rates of 15% or below are generally considered a buyer’s market. However, there are always exceptions to the statistics, as the volatile markets of Greater Los Angeles prove time and time again.
Why does JohnHart only factor single-family homes into monthly absorption rates?
Our clients have shown us that they have an overwhelming interest in single-family homes. Therefore, we feel that adding townhomes and condos only muddies the results. To give the picture most accurate to our client’s interests, our absorption rate analysis solely focuses on the single-family home markets.
How does JohnHart calculate absorption rates?
We employ the same universal formula anyone uses to calculate absorption rates:
Northridge Heads North of 50%
February was all about the surge so we won’t keep you waiting with the biggest leap of the month. Northridge bounded a stunning 20 percentage points further into the seller’s favor. This is a neighborhood that tends to defy convention, going upward when other areas trend downward. But even with such erratic movement, Northridge rarely strays close to an official buyer’s market. Therefore, we’re not surprised that it surged so dramatically, nor that it handily secured the highest absorption rate for February at 51%. However, it’s worth noting that Northridge’s absorption rate hasn’t swelled this high since April 2024. This might be your sign to list your Northridge home for sale before the competition of the springtime really sets in.
Other Impressive Jumps
But Northridge wasn’t the only dramatic surge for February. Glendale and Reseda were right behind it with surges of 18 and 17 percentage points respectively. This puts Glendale at 42%; its highest absorption rate since December 2023. Despite Reseda’s skyrocketing to a 39% absorption rate, it’s still closer to the buyer’s favor than it was in December 2024; just two months ago. It’s a testament to just how far it fell in January this year.
Mini Surges Are Still Surges
The weakest surge for February 2025 goes to Upland. The foothill city increased by just a single percentage point, skipping upward to 39%. It’s still far from our lowest absorption rate of the month. That honor goes to Encino, the Valley community that seems to always shine on the buyer a little bit more than our other areas of service. That being said, Encino’s 23% absorption rate is still a good deal ahead of the universal threshold for a buyer’s market.
Now is the Time
While February was a much-needed bit of refreshment for the prospective buyers out there, March confirmed what we pretty much already knew. It’s still a great time to list your home on this hungry market. So, if you’ve been going back and forth, it might be time to start shaping your strategy with one of our skilled agents. The spring selling season is about to open up, so the sooner you get going, the better your chances of beating the rush!
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