What Homeowners and Buyers Need to Know About the 2026 Los Angeles Real Estate Market

Buying or selling a home in Los Angeles is a major financial decision, and the real estate process can become more complicated when negotiations are aggressive, financing is uncertain, and buyers are taking a closer look at property conditions.

As the market heads into 2026, Scott Himelstein of the Scott Himelstein Group shares several challenges he has observed in real estate transactions across Los Angeles. His message to homeowners, buyers, and sellers is simple: trust the process, but verify the details.

From pricing a home correctly to understanding condo association finances, here are the key considerations Scott believes buyers and sellers should keep in mind.

1. Why Overpricing a Home Can Backfire

One of the biggest mistakes sellers can make is listing their home above what the market supports. While aiming for the highest possible price is understandable, an ambitious asking price can lead to fewer showings, extended time on the market, and eventual price reductions.

Scott also warns homeowners against renting out a property simply because it did not sell at the price they wanted.

Once tenants move in, showing access can become more complicated. Tenants have their own schedules, privacy concerns, and living arrangements, which can make it harder to present a home in its best condition. If rent payments stop, the owner may also face additional costs, legal complications, and delays.

For homeowners who intend to sell, pricing the property appropriately from the beginning may be a more straightforward strategy than renting it out temporarily and attempting to sell later.

If a property is already tenant-occupied, planning is essential. Scott recommends working cooperatively with tenants, communicating expectations, and considering appropriate incentives for reasonable showing access.

The takeaway is to establish a clear selling strategy before deciding to rent out a property that has not sold.

2. Choose a Real Estate Agent Carefully

The professional representing you can have a meaningful impact on your transaction.

Scott describes a negotiation in which a buyer’s agent allegedly asked him, as the listing agent, to contribute $6,500 of his commission in exchange for getting the buyer to sign. He says he declined and uses the incident to emphasize the importance of professional ethics.

His broader point is that buyers and sellers should evaluate an agent’s reputation, experience, communication, and integrity before hiring them.

A real estate agent should prioritize the client’s interests, explain the transaction clearly, and handle negotiations professionally. Poor communication or questionable conduct can create unnecessary complications and undermine confidence between the parties.

Before choosing an agent, consider asking:

• How much experience do you have with properties like mine?
• How will you communicate updates and negotiation developments?
• What is your strategy for handling difficult offers or counteroffers?
• How will you protect my interests throughout the transaction?
• Can you explain the compensation arrangement and relevant agreements clearly?

The goal is to find a professional who can explain the process, advocate for your interests, and help you make informed decisions.

3. Prepare for More Complicated Negotiations

Scott says he has been seeing more rounds of counteroffers and more extensive buyer investigations during transactions.

A deal that once might have involved a few negotiation points can turn into several rounds of discussion over smaller details. After inspections, buyers may request repairs or credits based on what they discover.

For sellers, preparation can help reduce surprises. Depending on the property and local requirements, inspections before listing may include a general home inspection, termite inspection, roof evaluation, and main sewer line inspection.

Understanding the property’s condition early gives sellers more information to work with when setting expectations and negotiating with buyers.

Buyers also need to approach inspections carefully. Investigations should help them understand the property’s condition and make informed decisions, rather than become a source of avoidable confusion late in the transaction.

For access to the property, sellers can discuss reasonable procedures with their agent, including advance scheduling and appropriate coordination with inspectors and other vendors. Any requirements should be handled consistently with the purchase agreement and applicable law.

The objective is to keep negotiations grounded in clear information rather than unexpected discoveries.

4. Understand Condo Financing and HOA Risks

Condos can present additional considerations beyond the unit itself. According to Scott, financing eligibility, homeowners association requirements, insurance coverage, and the financial health of the association can all affect a transaction.

A condo project that does not meet a particular lender’s requirements may limit the financing options available to buyers. This can also affect the pool of potential purchasers when an owner decides to sell.

Before buying or selling a condo, pay attention to:

• Insurance coverage: Understand the association’s policy and what individual owners may need to insure separately.
• HOA litigation: Review any disclosed legal disputes and understand whether they could affect financing or ownership costs.
• Owner occupancy: Check the association’s owner-occupancy information if it is relevant to the lender’s requirements.
• Reserve funds: Review the association’s financial records to understand its reserves and ability to cover future expenses.
• Special assessments: Look for information about planned repairs, maintenance projects, and possible additional charges to owners.

Special assessments can be particularly important when an association needs to fund major repairs or address maintenance that was postponed in previous years.

Reviewing HOA documents and meeting minutes can help buyers identify projects or financial concerns that deserve further investigation. Sellers should also disclose relevant information as required, rather than allowing significant issues to emerge unexpectedly during escrow.

5. Reduce the Risk of a Deal Falling Apart

A transaction can fall apart for several reasons, including inspection findings, financing problems, incomplete disclosures, or disagreements over repairs.

Scott says he is seeing more cancelled escrows and cites a figure of nearly 30% in the video. That number reflects his stated observation and is not independently verified here as a current Los Angeles market-wide cancellation rate.

Regardless of the exact rate, a cancelled transaction can cost a seller time, money, and momentum. When a property returns to the market after going under contract, prospective buyers may also wonder why the original deal did not close.

To reduce avoidable uncertainty, both sides should focus on clarity early in the process.

Sellers can prepare property information and consider appropriate inspections before listing. Buyers can review disclosures promptly, communicate concerns, and understand their financing and contractual obligations.

Contingency periods and deadlines should be negotiated carefully based on the circumstances of the transaction. Shorter timelines may not be appropriate for every buyer or property, so the goal should be to establish realistic deadlines that allow the necessary investigations and decisions.

A well-organized transaction cannot eliminate every risk, but preparation and timely communication can help prevent some surprises.

6. Be Prepared for Appraisal Challenges

An appraisal can become a critical point in a real estate transaction, especially when comparable sales vary significantly or the appraised value comes in below the agreed purchase price.

Scott recommends that sellers and their agents prepare supporting information that explains the property’s value.

Depending on the property, that information may include:

• Recent comparable sales.
• A list of meaningful improvements and upgrades.
• A floor plan, when available.
• Details about features that distinguish the property from comparable homes.
• Relevant information about the agreed contract price.

An agent may also be able to coordinate with the appraiser and provide relevant property information when appropriate.

If an appraisal comes in below the contract price, the parties may need to discuss their options. Depending on the contract, financing terms, and the buyer’s available funds, this could involve renegotiating the price, considering additional funds, or exploring other permitted options.

Scott also mentions situations in which lenders require two appraisals and may rely on the lower valuation. These requirements are lender- and transaction-specific, so buyers and sellers should confirm the applicable rules with their lender.

The important lesson is to prepare for the appraisal rather than assume the agreed price will automatically be supported.

7. Price Your Home Based on the Market

Pricing is one of the most important decisions a seller makes.

A homeowner may have invested considerable time and money into a property, but personal attachment and improvement costs do not necessarily determine what buyers are willing to pay.

Scott warns that homes priced too high can sit on the market, accumulate price reductions, and ultimately sell for less than they might have with a more appropriate initial asking price.

Before listing, sellers should evaluate recent comparable sales, the home’s condition, competing listings, and current buyer activity.

It is also worth listening to feedback from experienced agents who understand the local market. A pricing strategy should reflect the evidence available, not simply the highest price a homeowner hopes to achieve.

For buyers, understanding comparable sales is equally useful. It helps put asking prices into context and provides a stronger foundation for evaluating an offer.

In a changing market, a realistic pricing strategy can be more effective than relying on an optimistic starting number.

What Buyers and Sellers Should Do Before Making Their Next Move

Scott’s advice for 2026 centers on preparation, realistic expectations, and careful decision-making.

If you are buying, review the property’s condition, financing requirements, disclosures, and any HOA obligations before making important decisions. Ask questions when something is unclear, and understand your contractual deadlines.

If you are selling, establish a pricing strategy based on market evidence, consider inspections before listing, organize relevant documentation, and prepare for negotiations before accepting an offer.

Both buyers and sellers should carefully vet the professionals they hire and make sure important details are documented and understood.

Real estate transactions involve financial and legal considerations that vary by property and situation. When necessary, consult qualified legal, lending, inspection, or tax professionals to address questions beyond your agent’s role.

Planning to Buy or Sell in Los Angeles?

Whether you are preparing to sell a home in Porter Ranch, exploring neighborhoods in the San Fernando Valley, or considering a purchase elsewhere in Los Angeles, having a clear plan can help you approach the process with greater confidence.

Scott Himelstein and the Scott Himelstein Group discuss pricing strategies, negotiations, and preparing homes for sale to help local buyers and sellers better understand their options.

If you are considering a move, start by understanding your property’s potential market value, your financial position, and the steps needed to prepare for a transaction.

Watch the video for Scott’s perspective on the challenges buyers and sellers may encounter heading into 2026, and leave a comment with the real estate topics you would like him to cover next.