My son Henry overheard me in the car yesterday talking about the cooling market and asked me what it meant.

 

I told him, “Sometimes everyone wants to buy a house, sometimes no one wants to buy a house, and usually it’s somewhere in between.”

 

The signs of the “somewhere in between” part are now unmistakable:

But the story of a market downturn isn’t everything coming down at once, or even at all.

 

The way corrections work is that certain types of properties and certain areas correct more than others.

 

Overall, the market is flat. Prices are flat. Transactions are, shockingly, up year-over-year in our market. But any realtor in L.A. knows that lots of houses are just sitting on the market, waiting for a buyer.

 

As I've said time and time again: well-priced, well-presented homes on great streets are flying off the shelves. 

 

But with discerning buyers, if the house has any head-scratching attributes (busy street, strange floor plan) or is improper or underwhelming in presentation (overpriced, not painted, or not staged), the buyers ultimately will determine that the home is not the one. 

 

And what we're observing is that the difference between a hot home and a sad home is specific to the house—not entire neighborhoods.

 

Except for Downtown L.A.

 

It’s looking pretty bad for sellers down there. Here are the numbers:

So, guess what? It’s a great time to buy a condo downtown.

 

No reason to think a $400K purchase couldn’t bounce back to $700K in a few years.

 

Are buyers lining up to do that? Nope.

 

Am I buying downtown condos? Nope. 

 

No one wants to buy at the bottom. And no one wants to sell at the top.

 

Are real fire-sale prices popping up downtown? Not yet. And they might not. Remember, you need a critical mass of motivated sellers to really drive prices down.

 

That one guy who sells at a huge discount doesn’t pull down the average price of the block. Everyone just looks at it and says “That’s an outlier. Ignore.”

 

Which is why I’m not holding my breath that my Los Feliz neighborhood as a whole will go on sale anytime soon.

 

Or any neighborhoods around here. Too much equity, too many low mortgage rates.

 

And I know my neighbors. There’s no world I can imagine in which almost half of them have to dump their houses.

 

But pockets of opportunity are emerging. There are great buying windows in various property types. More on that next week.