Santa Monica Realtor Ray Lyon reports a 22% inventory drop in Q1 2026, sparking bidding wars for turn-key homes in Ocean Park and North of Montana.
SANTA MONICA, CA, UNITED STATES, February 2, 2026 /EINPresswire.com/ — Ray Lyon Realty Releases Q1 2026 Santa Monica Market Forecast: Inventory Drops 22% as “Micro-War” Erupts for Turn-Key Homes in Ocean Park
Ray Lyon Realty, a premier Santa Monica Realtor and brokerage located at 2115 Main St, has released its comprehensive Q1 2026 Real Estate Market Outlook. The report, which analyzes transaction data across the 90405 and 90402 zip codes, identifies a pivotal shift in the Westside housing market: while broader Los Angeles County inventory is stabilizing, Santa Monica is experiencing a sharp 22% year-over-year decline in available single-family listings, creating intense competition for renovated properties.
Ray Lyon, principal broker and founder of Ray Lyon Realty, warns that the “wait and see” approach adopted by many sellers in late 2025 has created a supply vacuum, particularly in the coveted Ocean Park and Sunset Park neighborhoods.
“The narrative that the market is cooling is statistically incorrect for Santa Monica,” says Ray Lyon. “While days-on-market (DOM) averages have crept up to 66 days, this is not due to a lack of buyers. It is due to a bifurcation of the market. Move-in ready homes in Ocean Park are seeing multiple offers within 12 days, while unrenovated inventory sits for months. We are essentially seeing a ‘micro-war’ for quality listings.”
Key Findings: The “Two-Speed” Santa Monica Market
The Q1 2026 report highlights three critical trends that are reshaping how buyers and sellers should approach the upcoming spring market:
1. The Inventory Crunch in 90405 Contrary to the rising inventory levels seen in the San Fernando Valley, Santa Monica has seen a constriction of supply.
Active Listings: Down 22% compared to Q1 2025.
Impact: This scarcity is protecting price floors, even as interest rates hover in the low 6% range. Buyers waiting for a “crash” are finding themselves priced out of prime streets in Ocean Park as lack of choices drives bidding wars on the few available “A-grade” homes.
2. The “Turn-Key” Premium Data from Ray Lyon Realty indicates a widening gap between renovated and original-condition homes.
Renovated Homes: Selling at an average of 104% of the list price.
Original Condition: Selling at an average of 93% of the list price.
Analysis: “Construction costs and permitting delays in Santa Monica have made buyers allergic to renovation projects,” explains Lyon. “They are paying a massive premium for the certainty of a finished product. For sellers, this means pre-listing prep—staging, minor cosmetic fixes, and landscaping—is no longer optional; it is the difference between selling in two weeks or six months.”
3. North of Montana (90402) vs. Ocean Park (90405) The report notes a divergence in luxury buyer behavior.
North of Montana: Buyers are prioritizing lot size and privacy, with off-market “pocket listings” accounting for nearly 18% of transactions in early 2026.
Ocean Park: Walkability remains the primary value driver. Properties within three blocks of Main Street are commanding $150+ more per square foot than comparable homes just half a mile east.
Strategic Advice for Santa Monica Sellers in 2026
With the average Santa Monica home price stabilizing around $1.82M, Ray Lyon advises sellers to adopt a data-centric pricing strategy.
“The days of ‘aspirational pricing’ are over,” says Lyon. “The AI-driven valuation models that buyers use are sophisticated. If a home is priced 10% above comps without clear value adds, it becomes invisible. Our strategy at Ray Lyon Realty focuses on ‘Event Pricing’—launching a home at a precise market value to generate a flurry of activity in the first weekend, which is the only way to retain leverage in this rate environment.”
About Ray Lyon Realty
Ray Lyon Realty is a boutique real estate brokerage located in the heart of Santa Monica. Founded by Ray Lyon, a top 1% producing agent and active real estate investor, the firm specializes in luxury residential sales, probate real estate, and investment properties across the Westside.
Unlike traditional brokerages, Ray Lyon Realty leverages a proprietary mix of hyper-local data analysis and advanced digital marketing to maximize asset value for clients. Ray Lyon holds an MBA and owns a portfolio of over 35 investment properties, providing clients with a level of financial acumen rarely found in residential real estate.
Media Contact: Ray Lyon Ray Lyon Realty | Realtor 2115 Main St Santa Monica, CA 90405 Phone: (310) 993-1065 Email: ray@raylyonrealty.com Website: https://www.raylyonrealty.com GMB Profile: https://g.co/kgs/RayLyonRealty
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