A summer cooldown hits the California housing market

Good morning, and welcome to the Essential California newsletter. It’s Thursday, Aug. 18. I’m Andrea Chang, a wealth reporter in the Business section.

The Southern California housing market continues to cool off, with the region’s median home price falling slightly in July from a month earlier. The real estate cooldown is being felt across the state, with a notable drop at the beginning of the summer in the Bay Area.

In SoCal, it was the third straight month prices failed to increase as some would-be buyers put off purchasing a home due to rising mortgage rates. The six-county region’s median sales price was $740,000 last month, 1.3% below June’s level and 2.6% below the all-time peak this spring, according to data released Wednesday by real estate firm DQNews. Compared with July 2021, sales last month fell nearly 35%.

[Read “Southern California home prices slipped in July. More drops may be coming,” in The Times.]

Andrew Khouri, one of our housing reporters, says the latest figures are an indication that home values may have peaked and will continue to fall. Many home sellers are now cutting their asking prices, extending the length of contingencies and paying for repairs to get deals done, a dramatic change from earlier this year.

Covering wealth in Los Angeles is a fascinating beat, in part because often what’s going on in the broader economy doesn’t seem to affect the ultra-rich. Take, for instance, the luxury condo market, which I wrote about a few weeks ago. Despite a softening housing market overall and concerns about an impending recession, developers are pushing ahead with over-the-top condos, including a pair of $50-million penthouses at 8899 Beverly in West Hollywood and a $75-million penthouse at the Four Seasons Private Residences Los Angeles.

Demand for lavish condos is high. In the first half of the year, 257 condos sold for $2 million or more in L.A. County, compared with 170 in the same period last year and 75 in the first half of 2020, according to the Multiple Listing Service. And the number of condos in Greater Los Angeles that closed for more than $5 million in the second quarter rose 175% year over year, according to a report by Sotheby’s International Realty.

Last month, a penthouse at the Pendry Residences West Hollywood closed for $21.5 million, making it the priciest condo sale this year and the fourth-most expensive in the county’s history.

Speaking of sky-high home prices, the San Francisco Chronicle reported Wednesday that housing affordability fell in all nine Bay Area counties in the second quarter of 2022 — this despite the recent cooling of the market. Only 18% of home buyers in the region could afford to purchase the $1.495-million median-priced home in the period from April to June, according to the housing affordability index by the California Assn. of Realtors.

If you’re thinking about buying but need some help, the Business section put together a comprehensive step-by-step home-buying guide this spring. You’ll find tips on finding the right real estate agent, an open house checklist, advice on how much to put down and more.

And now, here’s what’s happening across California:

Note: Some of the sites we link to may limit the number of stories you can access without subscribing.

A negative result on a rapid at-home test doesn’t necessarily mean you don’t have COVID-19, California health officials warn. Because of a lag in how long it can take a rapid test to turn positive after the onset of symptoms, they recommend repeat testing. Los Angeles Times

L.A. STORIES

A section of the 210 Freeway running through the San Gabriel Valley is closed for five days. The eastbound lanes of the 210 between the 605 Freeway and Irwindale Avenue were shut starting at 10 p.m. Wednesday; the closure is expected to last through 5 a.m. Tuesday; several connectors and on- and off-ramps in the area are also closed. Los Angeles Times

LeBron James has agreed to a contract extension with the Lakers, keeping him from free agency until at least 2024. The contract is worth the max that could be offered: $97.1 million. James, 37, was set to become an unrestricted free agent after this season. Los Angeles Times

Former employees of a now-defunct Santa Monica ad agency are raising concerns about the company’s payments to the CEO’s stepsons. Sources claim the two — who were employed at Roger Schaffner’s Palisades Media Group for nearly two decades and paid $65,000 a year each — did not actually perform their duties and rarely showed up for work. Los Angeles Times

POLITICS AND GOVERNMENT

San Francisco employs tens of thousands of workers across its city and county departments, with the highest-paid employee making $601,000 last year. The lowest-paid full-time city government employee made $36,000; the average was roughly $127,000, which includes overtime. San Francisco Chronicle

CRIME, COURTS AND POLICING

Six bodies were found by the coroner at the Aug. 4 car crash site in Windsor Hills, but California law is split over how to count the victims. One was an unborn boy named Armani who was about a month from his due date. The fiery collision was so violent that it tore Armani from his mother’s womb. Los Angeles Times

An Orange County lawyer’s bragging after winning a medical malpractice case has prompted a judge to throw out the verdict. After the trial, lawyer Robert McKenna III boasted in an online celebration video that the case involved “a guy that was probably negligently killed, but we kind of made it look like other people did it.” Citing those remarks, the judge who presided over the trial has vacated the verdict and ordered the case back to court. Los Angeles Times

A church that gives out cannabis and psychedelic plants as communion has filed a civil rights lawsuit against the city of Oakland and the Oakland Police Department over a 2020 police raid. Los Angeles Times

THE ENVIRONMENT

Coyote experts are casting doubt on an ultramarathoner’s account of being attacked during a run in Marin County. Dean Karnazes, a famed long-distance runner, posted a video on Instagram last week that showed his mouth covered in blood. “I just had something rather terrifying happen,” he said in the clip. “I’m out on a 150-mile trail run and got attacked by a coyote. That was a first. It knocked me over.” SFGATE

CALIFORNIA CULTURE

A man enjoys a walk along Lechuza Beach in Malibu on Aug. 10.

(Genaro Molina / Los Angeles Times)

Don’t let those Malibu homeowners deter you: All 11 of these lesser-known beaches are open to the public. Los Angeles Times

CALIFORNIA ALMANAC

Los Angeles: sunny, 85. San Diego: partly cloudy, 79. San Francisco: partly cloudy, 68. San Jose: partly cloudy, 85. Fresno: sunny, 107. Sacramento: sunny, 102.

AND FINALLY

Today’s California memory is from Carolyn Maxwell:

If you have a memory or story about the Golden State, share it with us. (Please keep your story to 100 words.)

Please let us know what we can do to make this newsletter more useful to you. Send comments to essentialcalifornia@latimes.com.