The Wall Street Journal on Tuesday reveals to the rest of the business world what most builders already know: the action is in the lower-priced end of the market. The WSJ (subscription required) interviews Realtors and builders and gathers intelligence in several markets to illustrate this dichotomy in the housing market:
A two-bedroom house in Los Angeles listed for $585,000 received 10 offers in the first week it hit the market, with the winner agreeing to pay $640,000.
Meanwhile, a four-bedroom house a few miles away, priced at $3 million, sat on the market for more than a month with no offers before selling for $2.75 million in January.
The divide in Los Angeles is typical of what is happening across the country. Housing has become a tale of two markets, brokers and economists said, with lower-priced homes selling quickly even as inventory of expensive ones piles up.