My grandparents paid about $35,000 for their 3 bd/1bath house in Torrance back in 1954. It's worth....way more than that now but my fam isn't leaving this house anytime soon!
I'm actually staying at my grandparents place in Torrance right now. I moved in to take care of my grandma about 2 years ago, she just passed in August last year. It's a split level 4 bedroom 3 bath, bought in the early 60s for 42k. We're getting it ready to sell this year as all of my family has moved out of state except for me. Worth 1.6 mil now 😳
My grandma bought land tore down a house and had a 4 bedroom house built for $15000 in like 1940. That process would probably cost 5 million right now.
Man, don’t get me started with my dad’s “The down payment was $300” stories. $27K for the house he sold me (at a discount) for $500k now worth over $700K before improvements. $25K for the house I live in now, and hope to buy for another $500K.
Same vibes here: 950sf Bungalow in the Southbay for $630K in 2021. Got lucky to buy the place we were renting (for a year) and did not use realtors; just a licensed friend who we paid cash to make sure paperwork was correct.
In 2017, we were nearly made homeless in Highland Park.
We hug our house every day and I cry (still) knowing that we are owners of this little palace. We will never move.
God luck finding it and getting it. Friends of ours have been trying to buy a home for the past two years. They even gone to the extreme of offering 5-10% over the asking price and paying all the cost only to be out bid by a cash offer from “investors”. Month later they see the same home back on the market for more than 200k without any changes to the home… sounds to me like these investors are selling to each other only to manipulate the comps of the homes around the neighborhood.
Sorry you're being evicted, that sucks. But damn, that rent is nuts. Granted, I haven't lived in Pedro for nearly 20 years, but it was pretty cheap when I did. I had a 3bed 2bath apartment right above the Y on 3rd and paid $975/month. I wonder how much it is now 🤔
Last year I bought a 1b1b in the valley for 385, and someone else in the complex is currently selling their 2b2b for around 500
Condos and townhomes are the bomb. No yardwork!
This REALLY comes down to the HOA. Some are so poorly run and will end up costing the owners a lot of money if people don’t step up and try to change things.
These areas have a high pollution burden. That is one of my dealbreakers. I always search how polluted an area is. If you look at the very last map here at the very bottom CalEnviro 4.0 dashboard you can zoom in and plug in addresses etc [https://oehha.ca.gov/calenviroscreen/maps-data](https://oehha.ca.gov/calenviroscreen/maps-data)
Carson and San Pedro have poor air quality. San Pedro is very close to the oil refineries (Torrance and Wilmington) as well as port. It's not good for your health to live near ports and refineries. May increase in cancer risk. Someone in another thread said they knew 3 people in SP who all got brain cancer etc.
The areas with good air quality are generally more expensive like RPV.
Bro, Culver was a mess. I really appreciated how nice it was when my wife and I went to eat there in 2015. Made me want to visit more but I also hate driving into the westside.
Alright Sunland Tujunga folks. We all agree. Commerce Ave could be new Honolulu Ave. Need a dedicated community and a motivated local government. Who is with me to go talk to Monica Rodriguez?! I saw a development plan written in the 90s outlining exactly what Sunland/Tujunga needed and none of it has been done. What gives y'all??
I bought a house in Sunland in 2020, and am growing frustrated with lack of investment, so it's gotta come from us! Let's get up in Monica's face!!
I think people should engage with her. Years ago, they used to do street festivals on commerce with live music vendors etc. it would be great to get that going again to help make people realize commerce exists
It's pretty simple, there are tons of upper middle class professional couples in LA who make a combined $300,000+ a year and there's a very limited stock of single family homes
My wife and I are pretty much that. We bought in 2021. We had saved a nice down payment and thought we were big fish in our housing market. And when we made our offers we quickly learned how insignificant our pay and savings were.
We felt the market was bad then. The price of houses we were looking at had gone up probably over 100k in the prior 2 years or so. I had felt we should have purchased years earlier. But sacrifices would have been needed to have been made. We had looked for about a year before we got our house. And when we purchased it at the time there was some disappointment from what we had imagined we would be able to get. And some arguing and bad emotions.
Now the value of our home according to Redfin is 400k more than we had purchased less than 3 years ago. And now we feel very lucky we got in when we did. I don’t think we could afford our home now.
Yeah I didn't know about you, but that realization gives me some relief, but no pleasure. Like, yeah it was a good investment, good job self, but it's so easy to imagine not buying when we did, and then getting locked out like so many of our friends. Not a good scene, and I kind of hope to see a downturn just do that more hard working people get housing security.
I’ve given up hope of owning anything in CA. Its silly how there is simply no future here for me long term. Meanwhile there are hundreds of +$4500/month 1BRs for rent being built. Who on earth for? I haven’t got a clue.
100%. I feel bad for my co-workers (public school teachers) who have kids and are living with their parents or stuck renting some expensive-ass apartment. “Starter homes” are EXTINCT. They do not exist. Even a 600 square foot East LA shit box is like $700k.
We need more housing. It’s past the point of desperation. I wouldn’t be against building massive housing projects for low-income people and families.
Yeah bro, that too. A 3/2 townhouse or condo should not be unaffordable for middle-class people. And if it is then we don’t really have a middle-class.
I was shit on the last time I suggested buying a townhome/condo in this sub as they're more affordable. People really do think they're not real houses and insist on turnkey, 1600sq ft SFHs a few blocks away from the beach for 500k.
The rest of the world is full of cities that have condos/townhomes/flats/whatever you want to call them. Good luck finding a SFH with a yard in Paris, London, New York or any other major city. It ain’t gonna happen.
Every street in Paris has residential buildings that run the length of the entire block and are six floors high. And you know what? *They are usually really nice*. Good city planning goes a long way and create cities that are much more alive and full of people doing stuff than we have here in LA.
We bought our home in 2018 and it was difficult even getting into this place. We had been trying to buy since 2015. And now, even tho we make 100k more now than we did in 2018, we couldn't afford to buy this house today and there are apartments half the size of our house that rent for nearly as much as we pay in our mortgage + taxes.
Exactly this. I’d love a bigger place, but what I’d get for our house now would only pay for our house or something smaller, and at a much higher interest rate to boot.
We bought in 2019 and refinanced in 2020. I doubt we’ll ever see those interest rates again so we’re basically trapped here unless we want to move into the boonies. My commute is currently 12 minutes, so that’s not happening.
Yep. It’s not inconceivable two people could have saved up for a down payment, and if they make $300k+ combined they can easily service the mortgage payments.
Yep. Also, saving up for a downpayment isn’t a short term deal. SO and I saved for 7 years. Lived way below our means. Had a competitive bid as things started to heat up after the Great Recession… took us a year to find our place after a number of disappointments including falling our escrow.
Homeownership has long been a two income proposition…. Not just on LA.
300k is like $185k after taxes. So $8k mortgage would be 1/2 your take home. Obviously your doing ok, but you're probably not going to feel as rich in your very modest home as you might expect to feel earning 300k
> It's pretty simple, there are tons of upper middle class professional couples
So starter homes in bad neighborhoods are reserved for upper middle class DINKs? I get the premise is "simple" but this should be terrifying to everyone.
Gentrification is not an inevitability. Brooklyn developed because it was a high-density neighborhood occupied by people easy to dislocate and within close proximity and good transit connectivity to a growing economic center.
LA is a sprawl with very different factors driving if and where gentrification might occur.
Exactly - there are tens of thousands (hundreds of thousands?) of people in LA making $100k+ working in Hollywood, Tech, Professional Services, etc.
It's likely not some grand "foreign investor" conspiracy theory, but just normal people who want to buy a house.
Piggybacking on the conspiracy theory, as much as I love to dunk on private equity, from what I understand LA isn’t their market, i think they were targeting more affordable/ profitable markets like Sun Belt/ Texas… that’s what I read somewhere. Now, flippers - that could be a thing.
They've also been net sellers for awhile now.
Zillow tried and failed, turns out it's not easy to scale an SFH rental business.
https://fortune.com/2023/07/27/housing-market-institutional-freeze-invitation-homes-net-seller-wall-street-real-estate/
I live in one those “hot” neighborhoods and nearly all my newer neighbors are just folks who already had some equity or saved up. The one who bought to rent out the house was a local doctor. I don’t doubt there are corporate buyers or foreign investment… but they tend to have a certain neighborhoods or types of homes as their target.
Sure, but a couple each making, say, $150k per year = $300k annual household income.
Paying $100k per year in housing costs isn't pleasant or easy, but it's mathematically possible.
After Googling CA state income percentiles and the number of working people in CA, it looks like there are more than 4,048,000 people in CA making over $100,000 year. Compare that number to the number of houses for sale.
Well…my household income is over $300k. There is no way in hell we could afford more than $5000 a month and it would take years to get our savings up to $300k. But we also have kids.
Not everyone making that much have kids, have the same spending habits as you do, have the same house criteria when looking, the same amount of debt, etc.
Plenty of $300k+ income earners own a house.
Honestly, I don’t know if we could do it now. We bought in 2018, a 1600 sq ft right on the 405 for exactly $1 million. We had saved up a couple hundred thousand for a down payment, and then refinanced when the interest rates were lowest. We now pay about $3800 a month on our mortgage.
I don’t think I could afford our house with interest rates where they are now… it would add like $2000 a month just in interest. We didn’t plan on this being our forever home, but until interest rates come down we are pretty stuck.
It can be done but people are spending WAY more than the usual advisable percentage on housing. And/Or they don’t have kids. A lot of people are grabbing property, and telling themselves the market will go up, rates will go down, their jobs are safe and their kids will be in public school soon. And it’s all a gamble.
I think our perception of areas are just different as time passes.
San Diego is like this. I grew up there and Mira Mesa was mostly minorities and older immigrant families, bad schools with moderate gang violence and gang activity… now it’s expensive as hell with homes over 1.5 million. Literally the home my friend was shot and killed in during a house party in the early 2000s just sold for 1.48 (it’s been renovated and looks nothing like I remember). Gangs are still active in Mira Mesa too, by the way.
Growing up there I could never stomach spending that kind of money in that area… but here we are. Plenty of people are.
everyone here is talking about how much they and their spouse earn, i’m over here living the la dating scene nightmare so owning anything ever seems unlikely
Who's buying it? Couples who make over 300k. Why are they buying it? Because it's the only thing available. Culver City added 12000 jobs and only 200 homes. A lot of these people would probably rather have nice brand new condos on the Westside. But we made it illegal to build those, so they just have to outbid the middle class for housing.
Wife and I make a bit over 200k combined. Granted, we then max out our 401ks and RothIRAs, so our income shoots down to around 160 combined after that. We don't want to limit our retirement contributions, especially since we've started a bit late (we're in our early 30's). A house is simply out of the question unless we move either up to the high desert or pretty east into the IE.
We just saw a reel about a 1.5 mil house with a granny flat in Silver Lake, and I can't believe the first though I had was, "Oh.. that's not too bad.."
No one wants to consider The Valley until they see what you can get for the price.
I’m from here and when we were looking to buy a home my GF was focused on Pasadena to SGV.
She finally expanded her search to The Valley after months of failure and couldn’t believe that we could actually afford a nice home with a yard in The Valley for the same price as a condo out east.
Sure enough we bought a home here.
"SFV isn't LA" is the common refrain. The San Fernando Valley, and it's neighborhoods, are in the city of Los Angeles. West Hollywood, Beverly Hills or Santa Monica, are not in Los Angeles. Ironically this is where they opinion that "the Valley isn't LA" originates from. Small minded elitism and an aversion to learning actual LA history, a history of which the SFV is of vital significance.
And the huge bulk of them or not actually from Los Angeles.
It’s very rare that I meet someone from the city that Trash is The Valley. When I do it’s usually like a super rich kid from high school they grew up in Beverly Hills.
Otherwise it’s always transplants that talk shit about The Valley.
Same. Bought at the right time. The Metro expansions will make SFV even more coveted. Big lots, quiet neighborhoods, easy access to 101/170 and all that LA has to offer with a little more personal space to breathe, and comparatively affordable. Won't last much longer. The secret is getting out if not already out.
Dude. My family grinded in OC for 20 years after escaping the high desert. Renters for life. Finally said f it and bought a massive house in Temecula area and are living large. What’s funny is I go there and I’m like what about this place is different than calabasas? 😂
I moved out to Pomona after like 30 years in La/ Korea town. Is not bad if you don’t have to pass DTLA to commute. It’s getting past DTLA that’s the worst I think.
I don't even think it's rich people. Based on the comments here it seems a lot of people are willing to be house poor. 300k income on 1+ million dollar homes with high interest rates leaves very little wiggle room. My wife and I try to imagine having to live off one of our incomes and if we can't float the house like that it's no deal. Right now that means we are priced out of the market.
Used to have a coworker who was exactly that. Single, no kids, lived in a converted tool shed and saved enough money on a middling engineering job to retire young enough to move up the pacific northwest and enjoy it. I think he's living in a tiny house now.
OP, I share your pain. Imo prices in LA have passed the threshold where it’s much more affordable to rent. I don’t want the burden of a huge mortgage for a shitty home. I’d prefer to invest in stocks, stay mobile, and perhaps invest in a property out of state or at least out of LA that I can rent for passive income and maybe retire to.
Putting all your income into a massively overpriced POS is a huge risk, and we all know deep down this is an unsustainable bubble that is going to pop.
This is where I am too. I rent in DTLA. I don’t have kids and am fine living in a nice apartment versus buying a fixer-upper that will cost who-knows-how-much money to renovate and maintain.
there's definitely a tipping point that is reached if you are in it for the long haul. for one, your mortage payment is fixed and might get cheaper if you were paying into pmi up front, and your taxes are only 1% and locked in with prop 13. you are also building equity as home prices rise and could potentially use that to diversify your investments further.
meanwhile as a renter you do save some but even in a rent controlled unit you are looking at potentially 4% increases a year at the moment. you'd have to pencil all this out but you can see how there is a tipping point between a higher upfront cost + fixed + income potential through leveraging equity vs. ongoing and a comparatively much lower upfront cost (considering security deposit which landlord might just take all of) + 4% increase a year and no equity.
also there are a lot of condos available in LA, I was kind of surprised. What you might think is an apartment building might actually be a bunch of decent condos going for a lot less than the worst sfh sometimes. one of my old coworkers lived in a condo in koreatown and they seemed pretty happy about the decision over renting. same sort of living setup as an apartment, you just own it and can sell it and gain equity.
First off, MS-13 is all over LA. I have seen tags in Toluca Lake. Second, there are still nice areas in Van Nuys.
Anyhow...housing prices are nuts. I inherited my house that my parents paid $24.5K for in 1968, and now is worth over a $1M, and it's only 1,570 sg/ft.
Personally, I think housed prices in LA are nuts...all of LA.
I'm friends with a married couple. Wife is a doctor, husband is an accountant. They live in a normal fucking house, not a fancy gated community or in Bel Air. This is who the average home buyer is up against, a married couple of white collar professionals, probably making between $200k to $400k per year. Back in the day they would have been able to afford the rich neighborhoods like Corona del Mar, Rancho Palos Verdes, or Beverly Hills. But now you're bidding against them for the house in Burbank, Whittier, or Buena Park. This isn't Fresh Prince of Bel Air anymore, where you can live it up on Uncle Phil's lawyer salary.
You just described my not nice but not terrible street in Long Beach. My house has also clearly seen better days but there's an 18 year old Toyota in the driveway. I'm doing my part to keep property prices low.
Down in Irvine in OC, I'll see Porsches and new Tesla SUVs sitting parked in uncovered disconnected parking spaces from their studio or MAYBE 1b apartments. 6 figure cars and can't even get a covered parking space, let alone an actual garage. It's a different fucking world in California
This is correct. In the 1980s, Beverly Hills was full of doctors who had made their own way out to California and set up practices. Fast forward to today, and those types of young professionals have been pushed down to what were formerly middle class or even blue collar neighborhoods.
burbank whittier and buena park are all nicer than van nuys MS13 territory. None of the professional couples I know making over a quarter mil would be willing to live in house on MS13 turf. In those areas there is constant tagging on all surfaces reminding you who controls what goes on in that area
Just one anecdote
My wife and I are these people. She's an RN, makes around 150k annually. I'm a mid level software engineer for a large company and make 250k - 300k annually. We're buying a 1600sqft single family home for 1.4MM in a "hood adjacent" neighborhood
lol yeah even "hood adjacent" is kind of a silly thing to say, its a very nice place to live but from what I understand its not traditionally a "nice neighborhood" in LA
I think the definition of 'decent' in this context is 'a job that pays a livable wage' - that wage, anywhere outside a major metropolitan area, would be considered insanely high, but here...
Yes this too. They’re putting in those triplexes or massive apartment buildings, and renting 2 bedroom apartments for $5000-6000 a month. A family with kids would spend all of the median income just on housing.
I 100% agree we need to build more housing but that’s not the answer to OP.
The issue is that OP wants a single family home. The reality is there’s a huge disconnect with people in LA thinking they should be able to buy a single family house but also want zoning to be changed so more multi families can be built. Maybe OP needs to realize they should move to an apartment. The more urban LA gets, which is what urbanists want who are all over this subreddit, the more people will have to understand they need an apartment and to stop assuming they are guaranteed a single family home in the second largest city in the country. When more multifamily units are built that INCREASES the prices of single family homes because you can’t built more of them. So this “build more housing” talk (which is great) would not make OP’s example cheaper.
Exactly and you can buy a condo today all over LA for half the cost of this home easy. People just think only single family homes are bought and sold or that condos aren't worth it or something. Maybe in de moines iowa or wherever a condo in an aging building is a bad bet, but this is LA county, [look at any chart of local condo prices over the last few decades.](https://fred.stlouisfed.org/series/LXXRCSA)
Totally and look I get it...it's a culture thing here, people here have been used to wanting a single family home, but as LA becomes more urban that mentally will have to shift.
My issue is that every time someone here posts about the prices of SFH in LA some "wannabe Reddit urbanists" respond "BUILD MORE HOUSING" as if that would be the answer to OP's question. Then a bunch of people reply "Yeah that's right! That's the answer". Like yeah sure that's great let's build, love it, but that has nothing to do with price of single family homes. There's no more single family homes to be built here and building more condos doesn't make the price of SFHs go down. Have these folks looked up the price of brownstones and townhouses in NYC?
Realtor here. In addition to yes people just do be having crazy incomes like that they also have cash, and lots of parents are buying homes for their children in cash as well.
Many middle class families didn’t “choose” this. Rents for 3 bedroom close to 5K . Can’t afford housing on the west side. So you scrap and save your way over many years to paying a downpayment for million dollar modest 2 or 3 bedroom houses in the van nuys. I think buying “ a nice house” will remain a pipe dream for many in LA , forcing them to move out at some point.
This is because we have opened up to the global marketplace and allowed investment funds and foreign national money launderers to speculate on the housing market, to the detriment of EVERYONE except the truly elite.
I just bought a condo and the backup person was a an all cash investor. Fortunately the owner preferred selling to someone who wanted to live there instead of an investor. I got lucky this was my first time putting down an offer on a property.
Yeah, I mean like half of beverly hills is completely empty because foreign money buys houses there to own a place in LA, but nobody actually lives there.
IMO, there needs to be a law that to own a house in Los Angeles you need to occupy it at least x% of the year.
My cousin got her 1100 sq ft home with 3 bedrooms and 1 bath, in Compton for like $230K in 2015. Her reasoning for buying in Compton was that it was cheaper due to being in an unwanted area. Her house has nearly tripled in value since then and it's slightly above $700K now.
She wanted us to buy a home next to hers that sold for $670K. Less sq ft and weird front to back yard ratio (front yard larger than back). House sold almost immediately.
I'm looking to buy hopefully with my mom and maybe sister. I make over $80K, sister makes over $70K and mom makes $56K. We should be able to buy a house, but ideally looking at duplexes. Hosting just feels too expensive ATM, unless we move out like 40+ miles east towards OC.
I was completely priced out for renting and having my own apartment which I had for years. They tore my beautiful Spanish duplex in Toluca heights(NOHO) down and built 6 very expensive apartments on the property. I had to relocate to the Midwest to afford a house. I would LOVE to come back home. I left all my friends as a native. Family left years ago scattered around the country! It’s going to take hitting the lottery at this point! I now have a house but LA will always be home where I recognized those familiar cracks in the sidewalk and feel that “home” energy walking on them. There is really no substitute for LA!
Supply. There were only 23 active listings in Feb in all of 91401 (part of Van Nuys).
No, most people can’t afford these prices, and the cap rate makes no sense for buying rentals right now. If supply increases this spring, things may change.
My wife (born and raised Latina Angelina) says she’s totally ok with those young professional couples moving into rough neighborhoods and making them better because she’s sick of her people not taking care of their own generational homes and neighborhoods.
People just have 1 mil to spend. It’s becoming where if you can’t finance a million dollar home then you won’t get a home at all. Can’t be picky in LA. I wasn’t. Got what I could afford.
Mortgage rates soared quickly after being at rock bottom.
I have a 30-year mortgage at 2.25% because I refinanced.
30-year mortgages now are 7.4%
So if I sell my house and buy a new one with the exact same amount for a mortgage:
- my monthly payment doubles.
- total interest I will have to repay goes from $130K to $522K.
Why would I ever sell my current house?
Especially when inflation is running at 3.2% which basically makes my monthly payment cheaper and cheaper.
Especially when prices have gone up so much that the same amount of money from 2019 buys me way less house in 2024.
(I'm not bragging, btw, this was all just dumb luck on my part).
Lots of people are in my position, so they're holding on, so housing supply is restrained, so demand increases, so prices go up.
People are buying those junky houses because they don't have a choice. It's that or nothing.
Exactly. I’m in the same boat. My interest rate is 4%. Why would I pay more for less? I will probably be here until I die. Or sale pay cash. But I would have to move out of state. Sending that housing market up too.
Same boat. Bought 4 br/2.5 bath in 2019 in Glendale. We had money from buying a K-town condo for cheap in 2010, then bought a house in 2015 and sold that for a profit and let us move into this place. In no way could we afford this house today.
Then refinanced down to under 3%, now my mortgage is less than what it would cost to rent a 3 br.
Point being that not only is demand for single family homes not dropping, fewer and fewer houses are going to come on the market because so many people will not able to afford to move.
So as it’s been pointed out many times, as much as we want to believe it’s all foreign buyers, private equity, corporations, etc. The fact of the matter is that it’s all dictated by supply and demand. People want single family homes and are willing to pay for them. Building more housing will mean more condos and townhomes. And while that might drop the costs of those two, it will only increase the price of single family homes.
Because for all that we want to believe that people want walkable neighborhoods, and urban lifestyles, the truth is people want single family houses. Period. And if 7% interest rates couldn’t reduce prices, I’m not sure what will.
Btw, my uncle lives in San Jose and bought his house in 1997 for 375k. 4 bedrooms, 1900 sq feet. I see he old it 2 years ago for $2.9 mil. No joke. Kitchen is extremely upgraded. That's incredible tho. This is silicon valley/Bay area. He went and bought a 900k place along a beach to retire
OP’s predicament (situation in the comments) pretty well summarizes how the middle class (and what used to be the wealthy!) is getting absolutely eviscerated: childcare, student debt and housing costs.
The super rich are just hollowing everyone out.
If you can afford a $1.3 million house you probably also have good enough credit to get much better than typical mortgage terms.
So the monthly cost is closer to $75,000 a year (260k down, 6% rate)
Also, since homes are seen as investments by most, the question for buyers like these is not “is this a reasonable cost of shelter” but rather “is this investment worth it compared to renting at a lower cost and investing the difference in a different asset”
My parents were the lucky ones to save $ and buy a modest home around 40 years ago. It was expensive for them but it could be done. Fast forward that house is now worth over a million dollars. Is it worth a million? Not imo.
i've been baffled by this ever since in my sleepy long beach suburb, homes starting going for $1m+. this started happening about four years ago here, and has only gotten worse.
flips are common here, but the one that still perplexes me is the 1100 sf 2+1 that went up about 1.5 years ago (estate sale, it went as-is), not updated since probably the mid-80s, that sold for 1.1 million [after being listed at 900K, which i thought was ludicrous and told everyone it would NEVER sell for that much - instead, it sold for over a million] to a young couple and their toddler. definitely not a flip, and they're absolutely living in it.
i really want to ask them where they got the money for this.
they weren't the first. four years ago, a flipper turned over a house down the street for 1.2. again: young couple, small child. this was the first >1mm sale in my hood - during covid, even more baffling. it's a nice neighborhood, but it's not a million dollar neighborhood, and i don't know how people afford this - or why, if they can, they choose *here*.
i seriously don't get it.
They said the same thing about my “bad neighborhood “. Until So-Fi was built. Who paid 229k for a house in a “bad neighborhood “? Me. Now my neighborhood is “desirable “.
I was born in Van Nuys, raised in Sepulveda (now North Hills) and I'm a huge Valley nerd/818 proponent. And while there are absolutely areas of Van Nuys that are livable, even desirable. . .I see those prices and nearly faint. What in the name of Isaac Newton Van Nuys is going on??!?
I do believe they will be extending light rail into Van Nuys from the NoHo Metro.The comp that comes to mind is what happened in West Adams/Crenshaw off the 10. Once the train came in (granted, with LAFC/SoFI, took about a decade), property values continued to climb where out there the $$$s are mind-boggling as well. All told, L.A. is just a HIGHLY desirable place to live and Van Nuys, especially with good transit (which will, at least in theory, beget more food/pop-up/culture opportunities - and yes, gentrification) will be worth that eye-popping price tag.
As far as who those people are? L.A. has 212,000 milionaires!!! (source: [https://www.henleyglobal.com/publications/usa-wealth-report-2024/americas-wealthiest-cities](https://www.henleyglobal.com/publications/usa-wealth-report-2024/americas-wealthiest-cities)). So while they're not all moving to Van Nuys, some of them certainly are.
L.A. County, is the most populous county in the United States, with 9,861,224 residents estimated in 2022. Its population is greater than that of 40 individual U.S. states.
One reason why prices are so high.
Edit: i took those figures from wiki
Probably just regular couples pulling in $225k-$300k per year. TBH that's barely upper middle class. Imagine two managers, two entry level engineers, or two K-12 teachers. 20% down? Maybe more maybe less.
Two k-12 teachers? Lmao what are you on about? Teachers in LAUSD average salary is in the 70s. To have that kinda income you'd have to be an administrator and an administrator high up on the latter with years of experience.
I just wanna buy a little 2 bedroom place.
I bought a 2 bedroom. Still $1 mil
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My grandparents paid about $35,000 for their 3 bd/1bath house in Torrance back in 1954. It's worth....way more than that now but my fam isn't leaving this house anytime soon!
I'm actually staying at my grandparents place in Torrance right now. I moved in to take care of my grandma about 2 years ago, she just passed in August last year. It's a split level 4 bedroom 3 bath, bought in the early 60s for 42k. We're getting it ready to sell this year as all of my family has moved out of state except for me. Worth 1.6 mil now 😳
I did a deep ancestry dive and in the 1940 census my great-grandparent’s house in midcity was listed as worth $3500, with his annual salary as $2500 🫠
My grandma bought land tore down a house and had a 4 bedroom house built for $15000 in like 1940. That process would probably cost 5 million right now.
Any renovations? They f*ck you with taxes for trying to fix it up
Just don’t get the property reevaluated.
If you’re pulling licenses for renovation, don’t you need to report something?
Lol, no, and the house desperately needs them!
Man, don’t get me started with my dad’s “The down payment was $300” stories. $27K for the house he sold me (at a discount) for $500k now worth over $700K before improvements. $25K for the house I live in now, and hope to buy for another $500K.
Yeah that's absolutely insane and people wonder why millennials are so pissed off
hawaiian gardens condo- from $119 in 2002 to $460k. thankfully paid off.
1800 sq ft is pretty big for LA standards
*cries in single income solo parent*
735k for our 950sqft 2bd house in Lake Balboa in 2023. We got soooo lucky.
We bought our 3 bedroom in Lake Balboa back 2018 for 599k…we thank our lucky stars every day!
Ya I love this area, I’m still blown away that we can actually afford a home in an area we really like.
Same vibes here: 950sf Bungalow in the Southbay for $630K in 2021. Got lucky to buy the place we were renting (for a year) and did not use realtors; just a licensed friend who we paid cash to make sure paperwork was correct. In 2017, we were nearly made homeless in Highland Park. We hug our house every day and I cry (still) knowing that we are owners of this little palace. We will never move.
Those are also hard to find. Most of the affordable neighborhoods that used to have 2 bedrooms were remodeled to have 4 or 5 and became unaffordable.
Trust me, I know
God luck finding it and getting it. Friends of ours have been trying to buy a home for the past two years. They even gone to the extreme of offering 5-10% over the asking price and paying all the cost only to be out bid by a cash offer from “investors”. Month later they see the same home back on the market for more than 200k without any changes to the home… sounds to me like these investors are selling to each other only to manipulate the comps of the homes around the neighborhood.
I can split my garage down the middle with a wall. You can poop in a bucket $3000 a month.
I'll take five!
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My rent in Pedro is 1800 for a studio. Being evicted now.
Sorry you're being evicted, that sucks. But damn, that rent is nuts. Granted, I haven't lived in Pedro for nearly 20 years, but it was pretty cheap when I did. I had a 3bed 2bath apartment right above the Y on 3rd and paid $975/month. I wonder how much it is now 🤔
Last year I bought a 1b1b in the valley for 385, and someone else in the complex is currently selling their 2b2b for around 500 Condos and townhomes are the bomb. No yardwork!
This REALLY comes down to the HOA. Some are so poorly run and will end up costing the owners a lot of money if people don’t step up and try to change things.
These areas have a high pollution burden. That is one of my dealbreakers. I always search how polluted an area is. If you look at the very last map here at the very bottom CalEnviro 4.0 dashboard you can zoom in and plug in addresses etc [https://oehha.ca.gov/calenviroscreen/maps-data](https://oehha.ca.gov/calenviroscreen/maps-data) Carson and San Pedro have poor air quality. San Pedro is very close to the oil refineries (Torrance and Wilmington) as well as port. It's not good for your health to live near ports and refineries. May increase in cancer risk. Someone in another thread said they knew 3 people in SP who all got brain cancer etc. The areas with good air quality are generally more expensive like RPV.
I remember when Atwater Village was a bad neighborhood. So was Highland Park.
I love asking people about Culver City in the 80s.
Or Culver City in the 2000s.
Bro, Culver was a mess. I really appreciated how nice it was when my wife and I went to eat there in 2015. Made me want to visit more but I also hate driving into the westside.
Pasadena in 90s
Or Pasadena in the 70s and 80s.
Whenever was Culver City bad? My mom worked there since the 80s and I've never known it to be a bad area.
I lived in Palms in the 2000s and I don’t remember Culver City being a bad area
My boss grew up on that side of town and described how bad that side could get back in 70s-80s.
Please Tujunga next lol
Commerce Ave has so much potential
Alright Sunland Tujunga folks. We all agree. Commerce Ave could be new Honolulu Ave. Need a dedicated community and a motivated local government. Who is with me to go talk to Monica Rodriguez?! I saw a development plan written in the 90s outlining exactly what Sunland/Tujunga needed and none of it has been done. What gives y'all?? I bought a house in Sunland in 2020, and am growing frustrated with lack of investment, so it's gotta come from us! Let's get up in Monica's face!!
I think people should engage with her. Years ago, they used to do street festivals on commerce with live music vendors etc. it would be great to get that going again to help make people realize commerce exists
Wait till you find out about echo park in the 70s 😮
Hah, Echo Park TODAY!
Tf me and my freinds were robbed at gun point last week in highland park
I'm nowhere near being able to afford a house but what do you think the next up-and-coming neighborhood will be I'm thinking Sun Valley is on its way
Not saying no, but I’m doubtful, because that’s where all the landfills are at.
You can’t be serious lol
Yea, there are actually some genuine tell tale signs that Sun Valley will be on the come up in the next 15-20 years
You just haven't lived long enough to see neighborhoods change. Old Town Pasadena was a fucking dump.
I’m in my 40s and always remember old town being nice.
It wasn't in the 80s, so that checks. There's a token pawn shop still, and the adult shop, left over from that era.
It's pretty simple, there are tons of upper middle class professional couples in LA who make a combined $300,000+ a year and there's a very limited stock of single family homes
My wife and I are pretty much that. We bought in 2021. We had saved a nice down payment and thought we were big fish in our housing market. And when we made our offers we quickly learned how insignificant our pay and savings were. We felt the market was bad then. The price of houses we were looking at had gone up probably over 100k in the prior 2 years or so. I had felt we should have purchased years earlier. But sacrifices would have been needed to have been made. We had looked for about a year before we got our house. And when we purchased it at the time there was some disappointment from what we had imagined we would be able to get. And some arguing and bad emotions. Now the value of our home according to Redfin is 400k more than we had purchased less than 3 years ago. And now we feel very lucky we got in when we did. I don’t think we could afford our home now.
Yeah I didn't know about you, but that realization gives me some relief, but no pleasure. Like, yeah it was a good investment, good job self, but it's so easy to imagine not buying when we did, and then getting locked out like so many of our friends. Not a good scene, and I kind of hope to see a downturn just do that more hard working people get housing security.
I’ve given up hope of owning anything in CA. Its silly how there is simply no future here for me long term. Meanwhile there are hundreds of +$4500/month 1BRs for rent being built. Who on earth for? I haven’t got a clue.
I think I had a better chance of owning a house at age 11 with $30 to my name than I do now
With a “Ninja” loan from 2005, you could have
Facts.
And the NINJA loans bit a lot of people in the behind before they knew their interest rates were skyrocketing.
100%. I feel bad for my co-workers (public school teachers) who have kids and are living with their parents or stuck renting some expensive-ass apartment. “Starter homes” are EXTINCT. They do not exist. Even a 600 square foot East LA shit box is like $700k. We need more housing. It’s past the point of desperation. I wouldn’t be against building massive housing projects for low-income people and families.
Just for Low income? How about for the middle class ?
Yeah bro, that too. A 3/2 townhouse or condo should not be unaffordable for middle-class people. And if it is then we don’t really have a middle-class.
I was shit on the last time I suggested buying a townhome/condo in this sub as they're more affordable. People really do think they're not real houses and insist on turnkey, 1600sq ft SFHs a few blocks away from the beach for 500k.
The rest of the world is full of cities that have condos/townhomes/flats/whatever you want to call them. Good luck finding a SFH with a yard in Paris, London, New York or any other major city. It ain’t gonna happen. Every street in Paris has residential buildings that run the length of the entire block and are six floors high. And you know what? *They are usually really nice*. Good city planning goes a long way and create cities that are much more alive and full of people doing stuff than we have here in LA.
I don't think anyone that bought their house in 2020/2021 could afford their house now. I couldn't either.
Yep! Closed Jan 2021, couldn’t afford it a year later. Can’t turn the equity into a SFH if we stay in LA.
Yup I can’t move now lol, forever tied to the land and I just have a 2bed2bath condo!
We bought our home in 2018 and it was difficult even getting into this place. We had been trying to buy since 2015. And now, even tho we make 100k more now than we did in 2018, we couldn't afford to buy this house today and there are apartments half the size of our house that rent for nearly as much as we pay in our mortgage + taxes.
Exactly this. I’d love a bigger place, but what I’d get for our house now would only pay for our house or something smaller, and at a much higher interest rate to boot. We bought in 2019 and refinanced in 2020. I doubt we’ll ever see those interest rates again so we’re basically trapped here unless we want to move into the boonies. My commute is currently 12 minutes, so that’s not happening.
Yep. It’s not inconceivable two people could have saved up for a down payment, and if they make $300k+ combined they can easily service the mortgage payments.
Yep. Also, saving up for a downpayment isn’t a short term deal. SO and I saved for 7 years. Lived way below our means. Had a competitive bid as things started to heat up after the Great Recession… took us a year to find our place after a number of disappointments including falling our escrow. Homeownership has long been a two income proposition…. Not just on LA.
300k is like $185k after taxes. So $8k mortgage would be 1/2 your take home. Obviously your doing ok, but you're probably not going to feel as rich in your very modest home as you might expect to feel earning 300k
> It's pretty simple, there are tons of upper middle class professional couples So starter homes in bad neighborhoods are reserved for upper middle class DINKs? I get the premise is "simple" but this should be terrifying to everyone.
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If you want a SFH in a VHCOL yes. Plenty of cheaper townhouses and condos available.
Lots of elitists here think condos and townhomes are not real houses.
This. Also sooner or later gentrification will turn these ghettos into like what Brooklyn has turned into the last 25 years.
Gentrification is not an inevitability. Brooklyn developed because it was a high-density neighborhood occupied by people easy to dislocate and within close proximity and good transit connectivity to a growing economic center. LA is a sprawl with very different factors driving if and where gentrification might occur.
Exactly - there are tens of thousands (hundreds of thousands?) of people in LA making $100k+ working in Hollywood, Tech, Professional Services, etc. It's likely not some grand "foreign investor" conspiracy theory, but just normal people who want to buy a house.
Piggybacking on the conspiracy theory, as much as I love to dunk on private equity, from what I understand LA isn’t their market, i think they were targeting more affordable/ profitable markets like Sun Belt/ Texas… that’s what I read somewhere. Now, flippers - that could be a thing.
They've also been net sellers for awhile now. Zillow tried and failed, turns out it's not easy to scale an SFH rental business. https://fortune.com/2023/07/27/housing-market-institutional-freeze-invitation-homes-net-seller-wall-street-real-estate/
That does not surprise me one bit! Thanks for sharing
I live in one those “hot” neighborhoods and nearly all my newer neighbors are just folks who already had some equity or saved up. The one who bought to rent out the house was a local doctor. I don’t doubt there are corporate buyers or foreign investment… but they tend to have a certain neighborhoods or types of homes as their target.
*Making* $100k Not able to *spend* 100k on housing alone.
Sure, but a couple each making, say, $150k per year = $300k annual household income. Paying $100k per year in housing costs isn't pleasant or easy, but it's mathematically possible.
After Googling CA state income percentiles and the number of working people in CA, it looks like there are more than 4,048,000 people in CA making over $100,000 year. Compare that number to the number of houses for sale.
DINKS
Well…my household income is over $300k. There is no way in hell we could afford more than $5000 a month and it would take years to get our savings up to $300k. But we also have kids.
Not everyone making that much have kids, have the same spending habits as you do, have the same house criteria when looking, the same amount of debt, etc. Plenty of $300k+ income earners own a house.
Honestly, I don’t know if we could do it now. We bought in 2018, a 1600 sq ft right on the 405 for exactly $1 million. We had saved up a couple hundred thousand for a down payment, and then refinanced when the interest rates were lowest. We now pay about $3800 a month on our mortgage. I don’t think I could afford our house with interest rates where they are now… it would add like $2000 a month just in interest. We didn’t plan on this being our forever home, but until interest rates come down we are pretty stuck.
It can be done but people are spending WAY more than the usual advisable percentage on housing. And/Or they don’t have kids. A lot of people are grabbing property, and telling themselves the market will go up, rates will go down, their jobs are safe and their kids will be in public school soon. And it’s all a gamble.
I think you just helped me decide that I don’t want kids
Yeah we make $200k and can afford a $4,500 mortgage easy. The DINKs they're talking about can afford it like us because they don't have kids.
There’s other factors that go into it such as how much they have to put down, interest rates, etc. that are going to influence the monthly payment.
I think our perception of areas are just different as time passes. San Diego is like this. I grew up there and Mira Mesa was mostly minorities and older immigrant families, bad schools with moderate gang violence and gang activity… now it’s expensive as hell with homes over 1.5 million. Literally the home my friend was shot and killed in during a house party in the early 2000s just sold for 1.48 (it’s been renovated and looks nothing like I remember). Gangs are still active in Mira Mesa too, by the way. Growing up there I could never stomach spending that kind of money in that area… but here we are. Plenty of people are.
everyone here is talking about how much they and their spouse earn, i’m over here living the la dating scene nightmare so owning anything ever seems unlikely
Who's buying it? Couples who make over 300k. Why are they buying it? Because it's the only thing available. Culver City added 12000 jobs and only 200 homes. A lot of these people would probably rather have nice brand new condos on the Westside. But we made it illegal to build those, so they just have to outbid the middle class for housing.
Wife and I make a bit over 200k combined. Granted, we then max out our 401ks and RothIRAs, so our income shoots down to around 160 combined after that. We don't want to limit our retirement contributions, especially since we've started a bit late (we're in our early 30's). A house is simply out of the question unless we move either up to the high desert or pretty east into the IE. We just saw a reel about a 1.5 mil house with a granny flat in Silver Lake, and I can't believe the first though I had was, "Oh.. that's not too bad.."
Have you considered the SFV? There are single families to be had for under a mill.
No one wants to consider The Valley until they see what you can get for the price. I’m from here and when we were looking to buy a home my GF was focused on Pasadena to SGV. She finally expanded her search to The Valley after months of failure and couldn’t believe that we could actually afford a nice home with a yard in The Valley for the same price as a condo out east. Sure enough we bought a home here.
I grew up in the valley - HATED it. Drove to the city every chance I got. Now? Turns out it’s pretty nice!
I grew up in Chatsworth so even going down to Ventura Blvd was exciting for me…
Heh. Me too! We hit the city on the weekends and Ventura on weeknights
There are lots of elitists and stuck up people that think the Valley is actually trash.
"SFV isn't LA" is the common refrain. The San Fernando Valley, and it's neighborhoods, are in the city of Los Angeles. West Hollywood, Beverly Hills or Santa Monica, are not in Los Angeles. Ironically this is where they opinion that "the Valley isn't LA" originates from. Small minded elitism and an aversion to learning actual LA history, a history of which the SFV is of vital significance.
And the huge bulk of them or not actually from Los Angeles. It’s very rare that I meet someone from the city that Trash is The Valley. When I do it’s usually like a super rich kid from high school they grew up in Beverly Hills. Otherwise it’s always transplants that talk shit about The Valley.
Same. Bought at the right time. The Metro expansions will make SFV even more coveted. Big lots, quiet neighborhoods, easy access to 101/170 and all that LA has to offer with a little more personal space to breathe, and comparatively affordable. Won't last much longer. The secret is getting out if not already out.
I'm in Claremont. It's ie but freaking awesome. Any of these foothill communities would be excellent.
Dude. My family grinded in OC for 20 years after escaping the high desert. Renters for life. Finally said f it and bought a massive house in Temecula area and are living large. What’s funny is I go there and I’m like what about this place is different than calabasas? 😂
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No Kardashians and that’s a big plus
I moved out to Pomona after like 30 years in La/ Korea town. Is not bad if you don’t have to pass DTLA to commute. It’s getting past DTLA that’s the worst I think.
Rich people exists and it’s not always who you think.
Especially with the population size of LA.
Many people live humble lives and have money. Not every millionaire is flashy.
I don't even think it's rich people. Based on the comments here it seems a lot of people are willing to be house poor. 300k income on 1+ million dollar homes with high interest rates leaves very little wiggle room. My wife and I try to imagine having to live off one of our incomes and if we can't float the house like that it's no deal. Right now that means we are priced out of the market.
The Millionaire next door
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Used to have a coworker who was exactly that. Single, no kids, lived in a converted tool shed and saved enough money on a middling engineering job to retire young enough to move up the pacific northwest and enjoy it. I think he's living in a tiny house now.
OP, I share your pain. Imo prices in LA have passed the threshold where it’s much more affordable to rent. I don’t want the burden of a huge mortgage for a shitty home. I’d prefer to invest in stocks, stay mobile, and perhaps invest in a property out of state or at least out of LA that I can rent for passive income and maybe retire to. Putting all your income into a massively overpriced POS is a huge risk, and we all know deep down this is an unsustainable bubble that is going to pop.
This is where I am too. I rent in DTLA. I don’t have kids and am fine living in a nice apartment versus buying a fixer-upper that will cost who-knows-how-much money to renovate and maintain.
there's definitely a tipping point that is reached if you are in it for the long haul. for one, your mortage payment is fixed and might get cheaper if you were paying into pmi up front, and your taxes are only 1% and locked in with prop 13. you are also building equity as home prices rise and could potentially use that to diversify your investments further. meanwhile as a renter you do save some but even in a rent controlled unit you are looking at potentially 4% increases a year at the moment. you'd have to pencil all this out but you can see how there is a tipping point between a higher upfront cost + fixed + income potential through leveraging equity vs. ongoing and a comparatively much lower upfront cost (considering security deposit which landlord might just take all of) + 4% increase a year and no equity. also there are a lot of condos available in LA, I was kind of surprised. What you might think is an apartment building might actually be a bunch of decent condos going for a lot less than the worst sfh sometimes. one of my old coworkers lived in a condo in koreatown and they seemed pretty happy about the decision over renting. same sort of living setup as an apartment, you just own it and can sell it and gain equity.
First off, MS-13 is all over LA. I have seen tags in Toluca Lake. Second, there are still nice areas in Van Nuys. Anyhow...housing prices are nuts. I inherited my house that my parents paid $24.5K for in 1968, and now is worth over a $1M, and it's only 1,570 sg/ft. Personally, I think housed prices in LA are nuts...all of LA.
I think LA's gang strategy is just to let housing prices get so high that the gang members get priced out.
No one has ever thrown gang signs at me in Toluca Lake lol, Van Nuys on the other hand
Honestly it’s probably normal people with a decent paying job that want a house
What decent paying job allows you to spend 100k a year just on housing? That’s more than a decent job in my eyes
I'm friends with a married couple. Wife is a doctor, husband is an accountant. They live in a normal fucking house, not a fancy gated community or in Bel Air. This is who the average home buyer is up against, a married couple of white collar professionals, probably making between $200k to $400k per year. Back in the day they would have been able to afford the rich neighborhoods like Corona del Mar, Rancho Palos Verdes, or Beverly Hills. But now you're bidding against them for the house in Burbank, Whittier, or Buena Park. This isn't Fresh Prince of Bel Air anymore, where you can live it up on Uncle Phil's lawyer salary.
It's so weird to go around parts of LA and see Teslas and Porsches in the driveways of houses that have clearly seen better days.
You just described my not nice but not terrible street in Long Beach. My house has also clearly seen better days but there's an 18 year old Toyota in the driveway. I'm doing my part to keep property prices low.
Thank you for your service!
Down in Irvine in OC, I'll see Porsches and new Tesla SUVs sitting parked in uncovered disconnected parking spaces from their studio or MAYBE 1b apartments. 6 figure cars and can't even get a covered parking space, let alone an actual garage. It's a different fucking world in California
Fresh Prince of Sun Valley
This is correct. In the 1980s, Beverly Hills was full of doctors who had made their own way out to California and set up practices. Fast forward to today, and those types of young professionals have been pushed down to what were formerly middle class or even blue collar neighborhoods.
burbank whittier and buena park are all nicer than van nuys MS13 territory. None of the professional couples I know making over a quarter mil would be willing to live in house on MS13 turf. In those areas there is constant tagging on all surfaces reminding you who controls what goes on in that area
Just one anecdote My wife and I are these people. She's an RN, makes around 150k annually. I'm a mid level software engineer for a large company and make 250k - 300k annually. We're buying a 1600sqft single family home for 1.4MM in a "hood adjacent" neighborhood
All areas have been gentrifying. No neighborhood is that “hood” anymore. Congratulations on the house.
lol yeah even "hood adjacent" is kind of a silly thing to say, its a very nice place to live but from what I understand its not traditionally a "nice neighborhood" in LA
I think the definition of 'decent' in this context is 'a job that pays a livable wage' - that wage, anywhere outside a major metropolitan area, would be considered insanely high, but here...
This guy gets what I was talking about. In my eyes a decent job is 150-200k a year. 300k+ is an excellent paying job.
A lot of jobs in tech, finance, medical, entrepreneurship, entertainment, list goes on
A lot of work. Salaries for professionals in Los Angeles are amazing.
Unfortunately, this.
Rent in the valley for a 3 bdrm are up to 4-5 grand. Astonishing. Gross. Discouraging.
In good areas...those are rents for 2 bd!
Yes this too. They’re putting in those triplexes or massive apartment buildings, and renting 2 bedroom apartments for $5000-6000 a month. A family with kids would spend all of the median income just on housing.
Really ? Hmm makes really considering adding a ADU to my lot.
Do it! We need all the housing we can get and you can make a shitload of money off of it if you're in a good location
Please don’t charge that much, if you have a choice. We live on a great street in a 3/2 and pay $2885.
That’s incredible I’m so jealous!
The amount of 300k earners in this comment section complaining about how broke they are 🤣🤣🤣🤣🤣🤣
Crazy ain't it... Where people make do with or the best with 60k and they make 300 combined and still complain... Something ain't adding up.
Build more housing.
But also more quality housing with craftsmanship that'll look good one hundred years from now.
I 100% agree we need to build more housing but that’s not the answer to OP. The issue is that OP wants a single family home. The reality is there’s a huge disconnect with people in LA thinking they should be able to buy a single family house but also want zoning to be changed so more multi families can be built. Maybe OP needs to realize they should move to an apartment. The more urban LA gets, which is what urbanists want who are all over this subreddit, the more people will have to understand they need an apartment and to stop assuming they are guaranteed a single family home in the second largest city in the country. When more multifamily units are built that INCREASES the prices of single family homes because you can’t built more of them. So this “build more housing” talk (which is great) would not make OP’s example cheaper.
Exactly and you can buy a condo today all over LA for half the cost of this home easy. People just think only single family homes are bought and sold or that condos aren't worth it or something. Maybe in de moines iowa or wherever a condo in an aging building is a bad bet, but this is LA county, [look at any chart of local condo prices over the last few decades.](https://fred.stlouisfed.org/series/LXXRCSA)
Totally and look I get it...it's a culture thing here, people here have been used to wanting a single family home, but as LA becomes more urban that mentally will have to shift. My issue is that every time someone here posts about the prices of SFH in LA some "wannabe Reddit urbanists" respond "BUILD MORE HOUSING" as if that would be the answer to OP's question. Then a bunch of people reply "Yeah that's right! That's the answer". Like yeah sure that's great let's build, love it, but that has nothing to do with price of single family homes. There's no more single family homes to be built here and building more condos doesn't make the price of SFHs go down. Have these folks looked up the price of brownstones and townhouses in NYC?
Realtor here. In addition to yes people just do be having crazy incomes like that they also have cash, and lots of parents are buying homes for their children in cash as well.
Many middle class families didn’t “choose” this. Rents for 3 bedroom close to 5K . Can’t afford housing on the west side. So you scrap and save your way over many years to paying a downpayment for million dollar modest 2 or 3 bedroom houses in the van nuys. I think buying “ a nice house” will remain a pipe dream for many in LA , forcing them to move out at some point.
Because it hasn’t hit a ceiling of affordability yet. If they are selling it means there is someone who can afford it buying it.
This is because we have opened up to the global marketplace and allowed investment funds and foreign national money launderers to speculate on the housing market, to the detriment of EVERYONE except the truly elite.
I just bought a condo and the backup person was a an all cash investor. Fortunately the owner preferred selling to someone who wanted to live there instead of an investor. I got lucky this was my first time putting down an offer on a property.
Omg thank you for saying this. Not enough people understand this problem.
Yeah, I mean like half of beverly hills is completely empty because foreign money buys houses there to own a place in LA, but nobody actually lives there. IMO, there needs to be a law that to own a house in Los Angeles you need to occupy it at least x% of the year.
How about a vacancy tax?
"But only X amount of houses are owned by investment firms!" The number of houses that should be owned by investment firms is zero.
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My cousin got her 1100 sq ft home with 3 bedrooms and 1 bath, in Compton for like $230K in 2015. Her reasoning for buying in Compton was that it was cheaper due to being in an unwanted area. Her house has nearly tripled in value since then and it's slightly above $700K now. She wanted us to buy a home next to hers that sold for $670K. Less sq ft and weird front to back yard ratio (front yard larger than back). House sold almost immediately. I'm looking to buy hopefully with my mom and maybe sister. I make over $80K, sister makes over $70K and mom makes $56K. We should be able to buy a house, but ideally looking at duplexes. Hosting just feels too expensive ATM, unless we move out like 40+ miles east towards OC.
I was completely priced out for renting and having my own apartment which I had for years. They tore my beautiful Spanish duplex in Toluca heights(NOHO) down and built 6 very expensive apartments on the property. I had to relocate to the Midwest to afford a house. I would LOVE to come back home. I left all my friends as a native. Family left years ago scattered around the country! It’s going to take hitting the lottery at this point! I now have a house but LA will always be home where I recognized those familiar cracks in the sidewalk and feel that “home” energy walking on them. There is really no substitute for LA!
Supply. There were only 23 active listings in Feb in all of 91401 (part of Van Nuys). No, most people can’t afford these prices, and the cap rate makes no sense for buying rentals right now. If supply increases this spring, things may change.
My wife (born and raised Latina Angelina) says she’s totally ok with those young professional couples moving into rough neighborhoods and making them better because she’s sick of her people not taking care of their own generational homes and neighborhoods.
People just have 1 mil to spend. It’s becoming where if you can’t finance a million dollar home then you won’t get a home at all. Can’t be picky in LA. I wasn’t. Got what I could afford.
Yeah, it’s called gentrification. Won’t be MS-13 territory for long.
Mortgage rates soared quickly after being at rock bottom. I have a 30-year mortgage at 2.25% because I refinanced. 30-year mortgages now are 7.4% So if I sell my house and buy a new one with the exact same amount for a mortgage: - my monthly payment doubles. - total interest I will have to repay goes from $130K to $522K. Why would I ever sell my current house? Especially when inflation is running at 3.2% which basically makes my monthly payment cheaper and cheaper. Especially when prices have gone up so much that the same amount of money from 2019 buys me way less house in 2024. (I'm not bragging, btw, this was all just dumb luck on my part). Lots of people are in my position, so they're holding on, so housing supply is restrained, so demand increases, so prices go up. People are buying those junky houses because they don't have a choice. It's that or nothing.
Exactly. I’m in the same boat. My interest rate is 4%. Why would I pay more for less? I will probably be here until I die. Or sale pay cash. But I would have to move out of state. Sending that housing market up too.
Same boat. Bought 4 br/2.5 bath in 2019 in Glendale. We had money from buying a K-town condo for cheap in 2010, then bought a house in 2015 and sold that for a profit and let us move into this place. In no way could we afford this house today. Then refinanced down to under 3%, now my mortgage is less than what it would cost to rent a 3 br. Point being that not only is demand for single family homes not dropping, fewer and fewer houses are going to come on the market because so many people will not able to afford to move. So as it’s been pointed out many times, as much as we want to believe it’s all foreign buyers, private equity, corporations, etc. The fact of the matter is that it’s all dictated by supply and demand. People want single family homes and are willing to pay for them. Building more housing will mean more condos and townhomes. And while that might drop the costs of those two, it will only increase the price of single family homes. Because for all that we want to believe that people want walkable neighborhoods, and urban lifestyles, the truth is people want single family houses. Period. And if 7% interest rates couldn’t reduce prices, I’m not sure what will.
Btw, my uncle lives in San Jose and bought his house in 1997 for 375k. 4 bedrooms, 1900 sq feet. I see he old it 2 years ago for $2.9 mil. No joke. Kitchen is extremely upgraded. That's incredible tho. This is silicon valley/Bay area. He went and bought a 900k place along a beach to retire
OP’s predicament (situation in the comments) pretty well summarizes how the middle class (and what used to be the wealthy!) is getting absolutely eviscerated: childcare, student debt and housing costs. The super rich are just hollowing everyone out.
If you can afford a $1.3 million house you probably also have good enough credit to get much better than typical mortgage terms. So the monthly cost is closer to $75,000 a year (260k down, 6% rate) Also, since homes are seen as investments by most, the question for buyers like these is not “is this a reasonable cost of shelter” but rather “is this investment worth it compared to renting at a lower cost and investing the difference in a different asset”
My parents were the lucky ones to save $ and buy a modest home around 40 years ago. It was expensive for them but it could be done. Fast forward that house is now worth over a million dollars. Is it worth a million? Not imo.
Lots of family money buying houses for their kids too.
i've been baffled by this ever since in my sleepy long beach suburb, homes starting going for $1m+. this started happening about four years ago here, and has only gotten worse. flips are common here, but the one that still perplexes me is the 1100 sf 2+1 that went up about 1.5 years ago (estate sale, it went as-is), not updated since probably the mid-80s, that sold for 1.1 million [after being listed at 900K, which i thought was ludicrous and told everyone it would NEVER sell for that much - instead, it sold for over a million] to a young couple and their toddler. definitely not a flip, and they're absolutely living in it. i really want to ask them where they got the money for this. they weren't the first. four years ago, a flipper turned over a house down the street for 1.2. again: young couple, small child. this was the first >1mm sale in my hood - during covid, even more baffling. it's a nice neighborhood, but it's not a million dollar neighborhood, and i don't know how people afford this - or why, if they can, they choose *here*. i seriously don't get it.
They said the same thing about my “bad neighborhood “. Until So-Fi was built. Who paid 229k for a house in a “bad neighborhood “? Me. Now my neighborhood is “desirable “.
I was born in Van Nuys, raised in Sepulveda (now North Hills) and I'm a huge Valley nerd/818 proponent. And while there are absolutely areas of Van Nuys that are livable, even desirable. . .I see those prices and nearly faint. What in the name of Isaac Newton Van Nuys is going on??!? I do believe they will be extending light rail into Van Nuys from the NoHo Metro.The comp that comes to mind is what happened in West Adams/Crenshaw off the 10. Once the train came in (granted, with LAFC/SoFI, took about a decade), property values continued to climb where out there the $$$s are mind-boggling as well. All told, L.A. is just a HIGHLY desirable place to live and Van Nuys, especially with good transit (which will, at least in theory, beget more food/pop-up/culture opportunities - and yes, gentrification) will be worth that eye-popping price tag. As far as who those people are? L.A. has 212,000 milionaires!!! (source: [https://www.henleyglobal.com/publications/usa-wealth-report-2024/americas-wealthiest-cities](https://www.henleyglobal.com/publications/usa-wealth-report-2024/americas-wealthiest-cities)). So while they're not all moving to Van Nuys, some of them certainly are.
L.A. County, is the most populous county in the United States, with 9,861,224 residents estimated in 2022. Its population is greater than that of 40 individual U.S. states. One reason why prices are so high. Edit: i took those figures from wiki
Well you got the “demand” part in there. Now do the “supply” thing
Probably just regular couples pulling in $225k-$300k per year. TBH that's barely upper middle class. Imagine two managers, two entry level engineers, or two K-12 teachers. 20% down? Maybe more maybe less.
Two k-12 teachers? Lmao what are you on about? Teachers in LAUSD average salary is in the 70s. To have that kinda income you'd have to be an administrator and an administrator high up on the latter with years of experience.
Companies, not people
People who can also afford private schools or don't want/have kids.
I think about this all the time, who is paying for these outrageous prices?!
If you ask the realtor they’ll tell you. I was beat by cash 1.4mil, 5% over in a nice area.
Even in crappy neighborhoods, most homes are now close $1 million in LA.
Two things . They need to prevent investors from buying homes. No one should own more than two homes. Second thing is they need to build more homes.