Week of October 3, 2026
There are 245 single family homes for sale across the Beach Cities and the Palos Verdes Peninsula. We close about 109 a month. If nothing new came on the market, the last listed home would go into escrow around December 8.
Is the South Bay market slowing down?
That kind of activity does not prove a slow market. What people are calling a slowdown is the residual effect of the recent rate bump. A buyer who would have stretched when money cost 3 percent is more hesitant to stretch at today’s higher rates. So we can see showings start to thin, properties that buyers have picked over continue to sit, and it feels like demand left the market. In truth, supply never loosened around here. It is the DEMAND that got selective, and almost overnight.
What moves a sale?
Three things heavily influence a sale: the rate, the asking price, and the condition of the house. In almost every market, for nearly every property, one of those variables is off. The seller wants last spring’s number, or the kitchen is original, or borrowing costs more than it did when they bought.
Why does 2021 still set the expectation?
2020 and 2021 were the rare years where all three lined up at once. The 30-year fixed averaged 2.65 percent in January 2021, the lowest Freddie Mac has recorded since it began the survey in 1971. Last week it averaged 7.28 percent, up from 7.03 the week before and 6.34 a year ago. On a $2,000,000 loan that is roughly $8,000 a month then against $13,700 now. Same house, same buyer, about $5,600 a month apart.
Cheap money usually shows up because something is broken. Rates fall in a recession, which is also when buyers are frightened and lenders pull back, so the rate is finally right and nobody can act on it. That was 2008 through 2012. What made 2020 and 2021 different is that the lowest rate in fifty years arrived while credit stayed open and buyers still had cash. Those two conditions almost never share a year, which is why people have been measuring every market since against an alignment that turns up maybe twice in a career.
What this means for you
In Neil’s experience, South Bay listings are not sitting because of an inventory swell. They are sitting on one of the other two, the asking price or the condition, and those are the two levers a seller still has total control over.
If you own, the rate is the one lever you do not control, and the other two are entirely yours. A buyer comparing your house to the four others they saw that Sunday is weighing your kitchen and your asking number, not the Freddie Mac average. If you are buying, that same $5,600 a month is why the field has thinned, which leaves less competition for the houses that are priced to today’s rate and show well.
Buying, selling, or still working out whether the South Bay is where to set down roots? Reach Neil at 310.798.3122 or [email protected]. There is no obligation, and we will follow up once.
What is next
Next Tuesday, another headline taken apart. The quarterly South Bay market report, area by area, publishes October 20, 2026.
Sources
- Rate figures: Freddie Mac Primary Mortgage Market Survey, week ending October 1, 2026, and the week ending January 7, 2021. Payment figures are principal and interest on a $2,000,000 loan at those rates.
- Inventory and closing counts: our own CRMLS Matrix pull.
General real estate information, not tax, lending, or investment advice. Stats presented here represent the city or area as a whole, not any one individual property.
Have a question about this? Neil answers personally.