LOS ANGELES, CA — As Southern California heads into the summer of 2025, the region’s housing market continues to be a focal point of interest for both potential homeowners and real estate investors. With the rise in demand for properties, particularly in urban areas like Los Angeles, San Diego, and Orange County, home prices have remained high, creating a competitive environment for both buyers and renters.
According to a recent report by the California Association of Realtors (CAR), the median price of a home in Los Angeles County has risen to $765,000, up 5% from last year. Similarly, homes in San Diego have seen a rise of 4.8%, with the median price hitting $850,000. These increases are being driven by several factors, including low interest rates, a high demand for housing, and the continued influx of people moving to California from other states.
Many first-time homebuyers are struggling to enter the market, particularly in the highly competitive neighborhoods of Los Angeles, such as Santa Monica and Venice Beach, where prices are soaring. “It’s a frustrating time for many people looking to buy their first home,” says Samantha Garcia, a real estate agent in Los Angeles. “Even with interest rates remaining low, there are just too few homes available, and when a property is listed, it’s often gone within days, sometimes even hours.”
In the face of rising prices, many renters are also feeling the pinch. In Long Beach, for example, the average rent for a one-bedroom apartment has climbed to $2,200 per month, up from $1,950 last year. While some renters have opted to move further inland to areas like Inland Empire or Riverside County, these markets are also experiencing price hikes, making it harder for renters to find affordable housing.
As prices continue to climb, the issue of affordability remains a top concern for policymakers in Southern California. Local governments have been looking into ways to provide more affordable housing options, but the challenge of balancing development with community needs is a difficult one. Some areas have started exploring new zoning laws that would allow for the construction of higher-density housing and multi-family units, but these proposals often face significant opposition from residents who worry about overcrowding and changes to neighborhood character.
Despite these challenges, the market for luxury homes continues to thrive. In neighborhoods like Beverly Hills and Malibu, high-net-worth individuals are snapping up multimillion-dollar properties, drawn by the area’s scenic views, proximity to entertainment industries, and exclusive lifestyle. The demand for second homes in coastal areas has also increased, fueled in part by remote work trends that allow people to live in more desirable locations without needing to commute to an office.
