First published in the Dec. 4 print issue of the Burbank Leader.
Despite a seasonal market slowdown, Burbank’s home values continue to increase rapidly, having surpassed an estimated $1 million for single-family homes earlier this year.
The midmarket Burbank home value — including single-family houses, condos and co-ops — was roughly $1.09 million in October 2021, according to the Zillow Home Value Index, reflecting a one-year increase of 18.7%. In October 2020, that figure was about $922,000. October’s number also reflects a jump of nearly 51% from 2016, when the typical home value was an estimated $726,000.
Zillow’s index is a seasonally adjusted estimate of home values in the midmarket — 35th to 65th percentile — range.
While the housing market has been on the rise for the past several years, values have increased rapidly this year. In Los Angeles County, Zillow data shows, home values increased by about 0.6% from October 2018 to October 2019. The one-year increase grew to 8.8% between October 2019 and October 2020, and 16.8% between October 2020 and October 2021.
Housing market experts have attributed the increasing prevalence of $1 million homes across Southern California to rising incomes, low mortgage rates and a pandemic-induced flood of demand from well-off residents tired of renting, according to the Los Angeles Times.
Burbank, like many nearby cities, has largely followed the county’s trend. Between October 2018 and October 2019, values increased by just 1.5% in Burbank, and they increased by 8.7% between the same months in 2019 and 2020.
Compared to the neighboring cities of San Marino, La Cañada Flintridge, South Pasadena, Glendale and Pasadena, Burbank’s midmarket homes tend to be nearest in value to those of the latter two, according to Zillow data. Pasadena’s homes were typically the least expensive at an estimated $1.08 million in October, while San Marino’s were by far the most pricey at roughly $2.52 million.
But Burbank’s home values experienced the most significant one-year growth of those cities. Its 18.7% increase in midmarket values between October 2020 and October 2021 outmatched Pasadena’s 17.3% and South Pasadena’s 17%, the closest runners-up.
However, the surge in home values is showing signs of slowing as the market approaches the winter months, according to the California Association of Realtors. The organization also reported that the share of California houses sold above asking price in October fell to its lowest percentage — 60.2% — since February. Prior to September 2020, less than half of sales were above asking price.
“Slower sales activity suggests that the market is returning to its typical seasonal pattern and further market normalization can be expected in the upcoming months,” CAR Vice President and chief economist Jordan Levine said in a news release. “While the market is showing signs of cooling off in recent months, 2021 continues to outpace last year’s sale level so far and is expected to post a gain at year-end.”
Heightened home values, while good news for owners, has prevented would-be buyers from entering the market. In the third quarter of 2021, according to CAR, an estimated 24% of households could purchase a median-priced, existing single-family home in California, down from 28% in the third quarter of 2020 and 56% in the third quarter of 2012.