What is Attracting Investors to the Los Angeles Market?

September 26, 2017 Marketing

The City of Angels has long been known for its near perfect weather, beautiful beaches and the entertainment industry – but these days, property investment represents another draw for this California metropolitan area. Let’s look at a few points that underpin this emerging development, and identify some of the main draws for investors in Los Angeles.

 

Pulling Record Profits

Record flipping profits were seen in Los Angeles last year. In fact, the Orange County Register finds profits averaged nearly $127,000 per flipped home in Los Angeles County. This figure is the highest in the region. Add in a median per-flip purchase price of $362,121 and a median sales price of $489,000, and it’s clear that flippers and investors are finding a good profit here.

Moreover, flipped homes are making up a decent percentage – 7.6 percent, to be specific – of all home sales in the area. That translates to 5,470 Los Angeles homes that were sold during 2016.

 

Gentrification Makes Neighborhoods Hot, Hot, Hot

Local areas including Glassell Park and Eagle Rock are seeing homes listing north of $800,000 – but this should not necessarily deter investors or flippers from considering Los Angeles as a whole. In fact, the advent of gentrification can make a great deal for a property investor – so long as one gets in at the right time.

View Of Los Angeles Rush Hour Traffic

Millennial Dreams Fuel Investment Means

The Los Angeles Times tells us that hipsters are becoming flipsters, drawn to the city by a desire to cut down on commutes by buying older and more affordable homes in what the newspaper calls “highly urban areas”.

Quoting UCLA Ziman Center for Real Estate professor Paul Habibi, the newspaper makes the case that flipsters are suited to selling homes to fellow hipsters: “In my classes, I always talk about ‘eating your own cooking,’” Habibi said. “It’s easier to design something that’s palatable to both you and the end user. Hipsters know what other hipsters like best.”

 

Impressive Economic Indicators

In June, the Los Angeles County Economic Development Corporation released its 2017 “People, Industries, Jobs Report”, which identifies a falling 2016 unemployment rate both in Los Angeles city and county along with construction as a major industry to target in the coming years. “As the housing market recovers, construction industries are expected to make a robust recovery,” the analysts write. “Housing starts are showing life after a dismal few years, and will be needed to meet pent-up demand.”

Herein lies an investor’s dream: a phoenix rising from the ashes, ready to find a new population for freshly rehabilitated property. In other words: ready, set, go.

 

Ready to Invest in Los Angeles?

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