Home price growth has been decelerating in 2025. Nationally, appreciation has slowed compared to the red hot years of the pandemic era, but it remains positive in most of the big cities, Los Angeles included. A few metros across the country are seeing modest pullbacks in their price indexes, yet here in Southern California, the market has largely held its ground.
The Current Picture
In Los Angeles, rising borrowing costs and affordability pressures have cooled the pace of appreciation. Buyers are more deliberate, sellers have to be realistic, and the pace of bidding wars has moderated. But that’s not the same as a market collapse. Instead, prices are leveling, and the market is moving toward balance.
Looking at the chart, you’ll notice that while the slope of appreciation isn’t as steep as it was a few years ago, the trajectory is still upward. That’s the key perspective… a slowdown in growth is not the same as declining values.
Long Term Perspective
Real estate rewards those who think in terms of decades, not just months. Historically, Los Angeles has experienced cycles ups, downs, and plateaus. Yet when you step back, the long term trend is unmistakable, ownership has delivered spectacular returns.
And when you add the impact of leverage, those returns multiply. Put simply, a 20% down payment gives you control over 100% of the property. If your home appreciates 5% in a year, that’s not a 5% return on your cash investment… it’s closer to 25% when you factor in leverage.
Why It Matters for Los Angeles
For Angelenos, the combination of limited land, high demand, and lifestyle amenities continues to support long term property value. Yes, growth in 2025 has slowed. But if you’re considering buying, the question isn’t just “what’s happening this quarter?”—it’s “where will I be in 5, 10, or 20 years?”
History tells us that Los Angeles homeowners who stayed invested have built significant wealth, even through short term fluctuations. That’s why focusing solely on month-to-month price shifts can be misleading.
The market is cooling from the frenzy, but homeownership in Los Angeles remains one of the best long term wealth building tools available. Whether you’re a buyer looking for timing or a seller evaluating your equity, understanding the broader cycle and the leverage factor helps put today’s market in perspective.
If you are in the Los Angeles area, and have any questions or real estate sales or financing needs, feel free to contact me
Ron Henderson GRI, SRES, SFR, RECS, CIAS, CREN, GREEN
President/Broker
Multi Real Estate Services, Inc.
Gov’t Affairs Chair – Southland Regional Association of Realtors (2025)
Gov’t Affairs Chair – California Association of Mortgage Professionals (2017-2018)
Chairman – OutWest Marketing Meeting (Real Estate Education)
BRE #00905793 NMLS #310358
www.mres.com
ronh@mres.com
Specialist in the Art of Real Estate Sales and Finance
Real Estate market, mortgage rates, Los Angeles, San Fernando Valley, Conejo Valley, Simi Valley, Woodland Hills, West Hills, Calabasas, Chatsworth
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