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Expecting a dip in Long Beach property prices in 2025? Think again.
Despite economic shifts, Long Beach's real estate market is poised for growth, driven by high demand and limited housing availability.
In this blog post, we will explore why property prices in Long Beach are set to rise in 2025.
We rely on solid, up-to-date data and statistics from multiple credible sources, ensuring our analysis is grounded in fact, not speculation.
By the end of this post, you'll see how we carefully analyze this information to reach our own well-informed conclusion. Enjoy the read!
How this content was produced 🔎📝
This article offers thoughtful insights and analysis based on reliable sources, but it should not be considered financial advice. We work hard to research, compile, and analyze data to give you a well-informed perspective. However, as you can guess, our analysis involves subjective choices, such as source selection and methods, and it cannot fully capture the market's complexity. Please, always do your own research, consult professionals, and make decisions based on your own judgment. Any financial risks or losses are your responsibility. Additionally, you should know that we have no affiliation with the sources mentioned, ensuring our analysis is completely impartial.
1) In Long Beach, there are only about 0.38 homes for each person, which is quite limited
Signal strength: strong
The fact that there is around 0.38 home per inhabitant in Long Beach indicates a limited housing supply. This low ratio suggests that housing demand is likely to exceed supply, which often leads to rising prices.
Long Beach is a desirable location due to its proximity to the ocean and vibrant community. This makes it attractive to both residents and investors, further increasing demand.
Additionally, the city has limited space for new construction, which restricts the ability to increase housing supply quickly. This constraint on new housing development can contribute to upward pressure on housing prices.
If the ratio were to increase to around 0.5 home per inhabitant, it might indicate a more balanced market, potentially stabilizing prices.
Source: USCensus
2) Home values in Long Beach have already risen by 5.0% since last year, and this trend could persist
Signal strength: strong
The fact that home values in Long Beach have already changed by 5.0% since last year is a strong indicator that the housing market is on an upward trend. This increase suggests that demand is likely outpacing supply, which often leads to rising prices.
Currently, the median home price in Long Beach is around $828,178, which is a significant figure for potential investors to consider. Additionally, the median sales price per square foot is around $622, reflecting the value buyers are willing to pay for space in this market.
These statistics, combined with the recent price change, support the assumption that housing prices might continue to rise in 2025. If the trend continues, it could mean a profitable opportunity for those investing in real estate now.
However, if the percentage change in home values were to drop significantly, it might indicate a shift in the market dynamics, suggesting a potential decrease in future prices.
Source: Redfin
We created this infographic to show how property prices in Long Beach compare to other big cities in California. It shows the median price as well as the price per sqft, making it easy to see which places might offer the best value. We hope you find it helpful.
3) Three major websites confidently predict that home prices in Long Beach will rise in 2025
Signal strength: strong
There are three major websites forecasting a positive growth for home prices in Long Beach in 2025, which is a promising signal for potential investors.
Among these forecasts, Realtor is the most optimistic with a projected increase of 7.30%, followed by Zillow's forecast of a 5.50% rise, and finally, Redfin predicts a 4% growth. The significant gap between Realtor's and Redfin's forecasts highlights the variability in predictions.
While these forecasts are encouraging, it's important to approach them with caution as they are based on predictive models that can change. We will also rely on strong, reliable, and current data to make a well-informed investment decision.
If these forecasts were to predict a negative growth or a decline in home prices, it would suggest a different market outlook.
Sources: ZillowForecasts, RedfinForecasts, RealtorForecasts
4) With a "vacancy rate" of just 5.5%, Long Beach's market is highly occupied and competitive
Signal strength: moderate
The vacancy rate in Long Beach is 5.5%, which is considered very low. This low vacancy rate suggests that the housing market is highly occupied and competitive, meaning there is strong demand for housing.
When demand is high and supply is limited, it often leads to increased housing prices as more people compete for fewer available homes. In such markets, properties that are easily rented are typically well-maintained and located in desirable areas.
Specifically, in Long Beach, modern apartments in downtown areas are highly sought after due to their proximity to amenities and employment opportunities. Investors should consider these factors when evaluating potential real estate investments in this market.
If the vacancy rate were to rise above 10%, it might indicate a shift towards a less competitive market, potentially affecting housing prices differently.
Sources: NeighborhoodScout, DataUSA, USCensus
Our team designed this infographic to show how competitive the real estate market in Long Beach is vs. other major cities in California. It shows the percentage of sales above the list price, a key indicator of market competition.
5) Long Beach has a "Livability" score of 69, indicating it's a pleasant place to live
Signal strength: moderate
The livability score of 69 in Long Beach is considered good because it reflects a balance of amenities, climate, and community engagement that appeals to residents. This score indicates that Long Beach offers a quality of life that is attractive to potential homebuyers, which can drive demand for housing.
One reason the score is good is due to Long Beach's vibrant arts and culture scene, which includes numerous galleries, theaters, and music venues that enrich the community. Additionally, the city boasts beautiful beaches and waterfront activities, providing residents with ample recreational opportunities and enhancing the overall appeal of the area. Furthermore, Long Beach is known for its diverse dining and shopping options, offering a wide range of experiences that cater to different tastes and preferences.
These characteristics make Long Beach a desirable place to live, which can lead to an increase in housing demand and, consequently, rising property values. As more people seek to move to areas with a good livability score, the demand for housing in Long Beach is likely to increase, potentially driving up prices in 2025.
If the livability score were to drop below 60, indicating a decline in quality of life, it might suggest that housing prices could stagnate or even decrease, as fewer people would be interested in moving to the area.
Source: AreaVibes
6) In Long Beach, nearly 44% of homes sell for more than their listing price
Signal strength: moderate
In Long Beach, around 44% of sales close at a price higher than the listing price, which is a strong indicator of demand. When buyers are willing to pay more than the asking price, it suggests that competition among buyers is intense and they are eager to secure a property.
This kind of market behavior often leads to an upward pressure on housing prices because sellers see that they can get more than they initially expected. As more buyers compete for limited inventory, the trend of paying above the listing price can become more common, further driving prices up.
For someone considering investing in real estate, this is a signal that the market is likely to appreciate in the near future, making it a potentially profitable investment. However, if the percentage of sales closing above the listing price were to drop significantly, say below 20%, it might indicate a cooling market where prices could stabilize or even decrease.
Source: Zillow
This infographic we have made will show you how market values have changed during the last decade in Long Beach vs other major places in California. Here, the percentage increase or decrease in market value will help you see long-term trends.
7) In Long Beach, home prices have steadily risen by an average of 7.4% each year over the past decade
Signal strength: minimal
The fact that home prices in Long Beach have appreciated at an average rate of 7.4% over the last decade is a strong indicator of a healthy real estate market. This consistent growth suggests that there has been sustained demand and increasing property values over time.
When we see a positive 10-year average like this, it often points to favorable conditions for future price increases. It reflects a market where people want to live, work, and invest, which can drive prices up. However, it's important to remember that past performance doesn’t guarantee future results, as market conditions can change.
Despite this, historical trends are still valuable indicators for potential investors to consider. They provide a context that can help in making informed decisions about where to put your money.
If the average appreciation rate were to drop significantly, say below 3% over a similar period, it might suggest a cooling market rather than one poised for growth.
Source: NeighborhoodScout
So, are prices going to climb in Long Beach in 2025? Absolutely
Long Beach's housing market is poised for a price increase in 2025 due to several compelling factors.
Firstly, the city has a limited housing supply, with only 0.38 homes per person, indicating that demand is likely to exceed supply. This imbalance often leads to rising prices. Additionally, Long Beach's proximity to the ocean and vibrant community makes it a desirable location, further increasing demand.
Moreover, home values have already risen by 5.0% since last year, and major forecasts predict continued growth, with Realtor projecting a 7.30% increase. The low vacancy rate of 5.5% and the fact that 44% of homes sell for more than their listing price highlight the competitive nature of the market.
Finally, Long Beach's livability score of 69 and a decade-long average price increase of 7.4% per year underscore its appeal. These factors collectively suggest that housing prices in Long Beach are set to climb in 2025, making it a promising opportunity for investors.
Related analyses:
- Yes, investing in real estate is a solid option in 2025 in Long Beach