Two numbers describe the same market and disagree by more than a million dollars. Over the twelve months ending August 2026, detached homes in MLS area 160 (Lunada Bay) sold at an average price of $3,820,535 and a median price of $2,725,000. Both figures are correct. They answer different questions, and knowing which one to read is the difference between pricing a home accurately and pricing it on a number that was never about that home.
What is the difference between average and median home price?
The average home price is the total of all sale prices divided by the number of sales. The median home price is the middle sale — half of homes sold for more, half sold for less. The average moves when one home sells for an unusual amount. The median does not, because the median only cares about which sale sits in the middle.
A simple illustration. Five homes sell for $2 million, $2.2 million, $2.5 million, $2.8 million, and $12 million. The median is $2.5 million, the middle sale. The average is $4.3 million, a figure higher than four of the five homes actually sold for. Nothing is wrong with either calculation. One describes the typical sale, the other describes the total money that moved.
Why are the average and median so far apart in Palos Verdes?
The average and median diverge in Palos Verdes because the Peninsula contains a small number of very high-value homes alongside a much larger number of homes in a narrower range. In MLS area 160 (Lunada Bay), a handful of bluff and ocean-view sales in the twelve months ending August 2026 lifted the average $1,095,535 above the median. A neighbourhood does not need many of those sales to move an average. It needs one or two.
This is why a Palos Verdes seller who reads only an average can arrive at an expectation no comparable sale supports, and why a buyer who reads only an average can conclude a neighbourhood is beyond reach when the middle of that market is a million dollars lower.
How large is the gap in each Palos Verdes neighbourhood?
The gap differs sharply by neighbourhood. The table below covers detached homes over the twelve months ending August 2026.
| MLS area | Average sale price | Median sale price | Gap |
|---|---|---|---|
| 160 — Lunada Bay | $3,820,535 | $2,725,000 | 40.2% |
| 170 — West Palos Verdes | $2,908,061 | $2,272,156 | 28.0% |
| 162 — Monte Malaga | $4,173,252 | $3,598,000 | 16.0% |
| 163 — Malaga Cove | $4,079,183 | $3,524,500 | 15.7% |
| 166 — Rolling Hills | $4,411,750 | $4,168,500 | 5.8% |
Rolling Hills shows a 5.8% gap, meaning sales there cluster relatively closely around the middle. Lunada Bay shows a 40.2% gap over the same period. A single Peninsula-wide average would describe neither neighbourhood well, which is why every figure on this site is reported by MLS area rather than by city or ZIP code.
Which number should a seller use?
A seller pricing a home should start from the median, then adjust for the specific property. The median describes the middle of the market, which is closer to where most homes actually transact. A seller whose home genuinely sits at the top of a neighbourhood — a large lot, a primary ocean view, a recent full renovation — may reasonably look above the median, but that case is made from comparable sales rather than from an average that a few unrelated homes produced.
Which number should a buyer use?
A buyer assessing affordability should read the median, and read it by MLS area. The median in MLS area 170 (West Palos Verdes) was $2,272,156 over the twelve months ending August 2026, while the average for the same area and period was $2,908,061. A buyer working from the average would overstate the entry point in West Palos Verdes by roughly $636,000.
What does a widening or narrowing gap mean?
A widening gap between average and median indicates that sales at the top of a neighbourhood are moving further from the middle of it. A narrowing gap indicates the opposite. Both readings deserve caution in Palos Verdes, because these neighbourhoods record between roughly 18 and 70 detached sales a year, and in samples that size the gap moves noticeably from one year to the next without any underlying change in the market. A single year’s gap is an observation. A direction requires several years.
Where these figures come from
All figures on this page are drawn from the California Regional MLS (CRMLS) via InfoSparks, covering residential detached homes over the rolling twelve months ending August 2026, reported by MLS area. A rolling twelve-month window is used rather than a single month because these neighbourhoods are small enough that one month’s sales can swing a median by more than a million dollars. Figures are refreshed quarterly.
Market statistics describe neighbourhoods, not individual homes. No figure on this page is an appraisal or an opinion of value for any specific property. Home values depend on condition, location, view, lot, and improvements, and are best assessed against comparable sales.