Lately, we've been blogging about some of the cities within the East Bay region, and…
Like much of the Los Angeles metro area, the Palmdale real estate market has been sizzling over the past year or so. The same is true for the city of Lancaster, Palmdale’s neighbor to the north. Tight inventory conditions and strong demand from buyers have led to quick sales and steadily rising home prices.
Here are the latest trends, developments and forecasts for the Palmdale, California real estate market extending into 2022.
Brief History of a Hot Real Estate Market
Palmdale and Lancaster are the principal cities that make up the Antelope Valley Region of Los Angeles County.
Long considered to be a bedroom community of Los Angeles, Palmdale and Lancaster have a combined population just north of 300,000 residents. There’s also a strong military and government presence in the region, from Edwards Air Force Base and various aerospace companies.
Over the past 15 months or so, the Palmdale real estate market has experienced increased demand for homes. This is true for much of the country, in fact. The coronavirus pandemic gave people a renewed appreciation for homeownership, home offices, extra space, and other amenities. This led to a surge and home-buying activity, at a time when real estate market inventory was already low.
That brings us up to the present. As of fall 2021, housing markets in Palmdale, Lancaster and elsewhere across the region remain highly competitive due to a supply-and-demand and balance. (More to follow on that.)
Home-price appreciation and sales activity are expected to cool down a bit in 2022. But it will still be a seller’s market for the foreseeable future, mainly due to the ongoing inventory crunch.
Palmdale and Lancaster Housing Forecast for 2022
Housing market forecasts Palmdale, Lancaster, and other Antelope Valley cities suggest that home prices will continue climbing into 2022. This would follow a year of unprecedented gains.
According to the latest data reported by Zillow, the median home value in Palmdale rose by a whopping 25% over the past year. The median house value for this real estate market was approaching $450,000, when this article was published. Home prices in Palmdale are higher now than they’ve ever been before.
The same is true for nearby Lancaster, California. House prices in that housing market rose by around 26% in the past year, landing at $414,000 as of November 2021.
For the broader Los Angeles-Long Beach-Anaheim metro area, Zillow predicted that home prices would rise by double digits between now and fall of 2022. According to a November 2021 statement on the company’s website:
Los Angeles-Long Beach-Anaheim Metro home values have gone up 18.8% over the past year and Zillow predicts they will rise 13.7% in the next year.
They didn’t offer a specific housing market forecast for Palmdale or Lancaster. But given the big gains recorded over the past year, it seems likely that prices in Antelope Valley could climb by double digits in 2022.
Supply Shortage Forcing Buyers to Compete
As of October 2021, both the Palmdale and Lancaster housing markets had about a 1.4-month supply of homes for sale. That is below the national average — and well below what’s considered to be a balanced real estate market.
This is arguably the number-one reason why home prices have risen so much over the past year. It’s also why housing market forecasts for Palmdale and Lancaster predict continued price growth into 2022.
Real estate agents in the area have also reported an increase in buyers from the Los Angeles area. Local RE/MAX agent Kenneth Terracciano recently told the Valley Press:
We’ve always been a bedroom community, but now you’re seeing more and more people coming from downtown [L.A.].
Given the lopsided supply-and-demand situation within the Palmdale and Lancaster real estate markets, it’s no surprise to see buyers making strong offers. Last month, more than half of all houses sold in the area went for more than the original list price. This is a direct result of the fierce competition among buyers in the Antelope Valley area.
Strong demand has also led to quick home sales across the region. Within the Lancaster and Palmdale real estate markets, homes are currently spending a median of around 14 days on the market before going under contract. This indicates a highly active housing scene with steady competition among buyers.
Summary of key points:
- Housing forecasts for Palmdale and Lancaster predict continued price growth in 2022.
- Tight supply conditions are the number-one reason why house values are rising.
- The median home price in both of these housing markets has risen to an all-time high.
- Houses for sale in Antelope Valley tend to sell quickly, often for more than the list price.
Need Mortgage Financing in the Antelope Valley?
While we’re located in the Bay Area, Bridgepoint Funding serves borrowers across the Golden State.
We specialize in VA home loans (a popular mortgage option in Palmdale, due to its strong military presence). Please contact us if you have mortgage-related questions or if you’d like to apply for a loan.
Disclaimer: This article includes real estate market forecasts for Palmdale, Lancaster and the broader Los Angeles metro area. Housing-related predictions are the equivalent of an educated guess and should be treated as such.