What may feel like a real estate bubble in Los Angeles--with all-cash offers and frenzied bidding wars--is actually the midpoint of a steady housing market recovery, analysts say.
The UCLA Anderson Forecast said L.A. is only three years into a rebound that started in 2012. Home prices have since climbed 27 percent. History suggests there will be four more years of price increases and home values will go up another 35 percent before there is any sort of correction.
The reason comes down to a fundamental imbalance: there’s lots of job growth, but because of strict building and environmental regulations, there will be very little increase in the housing supply.
“That means you will not expect to see housing more affordable during the next few years," said Jerry Nickelsburg, a Senior Economist at UCLA's Anderson Forecast. "In fact, just the opposite.”
While entering the market is tough, buying a home right now in Los Angeles isn't as risky as the high prices make it feel, the report said.
"L.A.’s housing market, despite becoming more expensive and unaffordable, is not in a bubble." UCLA economist William Yu wrote. "The current rise in home prices seems to be driven by rising effective demand and limited supply, not by speculation. Therefore, the housing bubble burst we experienced several years ago is unlikely to haunt us this year or next, and the smart money will continue to invest here."
That includes Chinese buyers, who have been bidding up Los Angeles houses in recent years.
Though the Chinese economy has recently slowed, Yu doesn't expect the downturn there to impact prices here. Yu said China's economic problems could actually raise home prices in Southern California as investors seek stability outside their country.
"With the dismal outlook and uncertainties in China, contrasted with the promising and stable outlook in the U.S., it is wise to reallocate money from China to the U.S.," he wrote in the report. "Even with the negative wealth effect generated from China’s deflating real estate, tumbling stock markets, and 3 percent currency devaluation, wealthy Chinese individuals still have sufficient equity to make a move."
Other industries, he said, like tourism and trade, could suffer.
5077 Princess Anne was on caravan today...cute 4 bedroom (3 big bedrooms including the master and one small, could be a perfect office or baby room). Great location in the Paradise Canyon area, open Sunday 1:00-4:00:
For more information on 1903 Ravista, please visit the property website
Also on caravan was a vintage 1980's gem at 621 Knight Way. I don't think I've ever been in a house so true to its era. Tile, carpet, cabinets...bedspreads...all from 1980! The family room had this unusual treatment on the walls and ceiling:
The 80's were an interesting time for architecture and design :)
MIDWEEK EXTENDED SUMMER HOURS
June 18 – Aug. 20 | 5 – 8pm | Tuesday – Thursday
A summer tradition, Descanso keeps its gate open late! Enjoy family programs, jazz concerts or a twilight walk. Members enter free; regular admission for nonmembers. No reciprocal gardens admissions.
MUSIC ON THE MAIN SUMMER JAZZ
WORLD RHYTHMS SERIES
Tuesdays, June 23 – Aug. 4 | 6pm | Main Lawn
Wednesday, Aug. 12 & Wednesday, Aug. 19 | 6pm | Oak Woodland
Who says summer camp is just for kids? Check out the newest addition to our extended summer hours in the new Oak Woodland.
Buy a brew at the Boddy Lodge, and purchase summer-fresh fare created by Patina. Try your hand at old-school camp crafts. The Flashdance will spin tunes on vinyl. Watch the sun set behind the San Rafael Hills. Oh, those summer nights!
The World Rhythms music series and the Lakeside Lounge have been made possible by a generous grant from the Capital Group.
Every Tuesday, Friday and Saturday June 16th thru Labor Day, 2015
In a nutshell, great houses priced right are still flying off the shelf with multiple offers in La Canada. To that end, our quote of the week:
We have 65 houses on the market in La Canada Flintridge. Another 35 are in escrow, many after fierce competition between buyers. A sampling of those:
1104 Descanso- 7 offers
1127 Atlee had 7 offers.
4803 Hampton had 6 offers
1222 Green had 6 offers.
4300 Commonwealth had 11 offers.
7 new listings are on caravan in La Canada tomorrow. We will know within the next week or two if they are priced right. If not, they will face an inevitable reduction and lower perceived value. At the end of the day, the only thing wrong with a house that sits on the market is...price.
Yes, we are in a seller's market where it seems all that you have to do is install a "for sale" sign in your front yard and buyers are lining up, contracts in hand. What is hard to quantify is how much sellers may be leaving on the table by not taking the time to get their house truly market ready. Some require just a bit of de-cluttering and fluffing, others need a complete makeover. When I took the listing at 4300 Commonwealth, the tenants had left it clean, empty and mustardy. The wall-to-wall carpet gave the place an 80's vibe. Needless to say, it needed a makeover...
We removed most of the carpeting, painted and brought in our slip covered furniture and fun accessories. I love my Phillips Collection deer head!
For more details about the staging, visit my Houzz page
Things are looking up! We have 47 active listings this week. 3 are new and notable:
4803 Hill last sold in 2006 (formerly known as the height of the market) for $900,000. It's small but cute...the best location under $1,000,000 in LCF in quite a while. I am sure their will be multiple offers on this one. 5147 Crown last sold in 2011 for $1,100,000. The house has been updated since and sits on one of the biggest lots on the street. 4407 Beulah last sold in 2007 for $1,850,000. The kitchen has been updated since. The house shows really well and I do love the street. We have lived in two houses on Beulah...great location.
QUOTE OF THE WEEK:
"Next to the writer of real estate advertisements, the autobiographer is the most suspect of prose artists." - Donal Henahan
I can't speak to the plight of the autobiographer, but we agents have already scraped the bottom of the synonym barrel and are back to the fluffy vocabulary of our childhood. A glossary:
Cute: small, puny, teeny-tiny. Big family fugget about it.
Beautiful: it's actually clean (many are not at all)
Exquisite: Can't think of anything else to say about it
Potential!: Ugly. Face it, there are so many other descriptive words that we simply cannot use. Our hands are tied.
It's not to say that some houses aren't really cute, beautiful, charming, exquisite and loaded with potential. But don't hold it against us that we have to get really creative with some of our writing. Who would want to go see a "small, dirty, old, (insert other descriptive word) ugly" house anyway?
Thanks to my latest daily addiction the Skimm (along with coffee and Veronica Mars DVDs), I have gotten heavily into quotes. If all goes as planned I will be posting weekly quotes that have anything to do with houses, real estate, community, etc.
"The best investment on earth is earth." -Louis Glickman
While Mr. Glickman resided in New York City not La Canada Flintridge, his sentiment resonates in our market. In the era of serial house flipping, all the new cabinetry and quartz counters are transient fixtures on the real investment, the dirt that they are sitting on.
We have 38 active listings in La Canada, compared to 40 at the same time last year. New and notable:
4811 Vineta is a bit tired though great location north of Houseman. 1210 Descanso looks good. Great location and lot. 2001 Tondolea last sold 9/13 for $1,180,000. It has been reimagined with the help of local architect Dave DeAngelis and shows well. 3972 Alta Vista is amazing. It's one of those houses that I have walked by for years. It was a 1966 showcase house and still has remnants of that. Grand rooms. Beautiful property.
5233 La Canada Blvd. had multiple offers and sold $200,000 over the asking price. 1117 Sheraton last sold in 2009 for $1,080,000. It has a newer kitchen, but funky layout and almost no backyard. 4531 Alta Canyada was previously leased for $4700 per month. 1323 Green has a challenging floor plan and confusing drainage behind the house. 4352 Beulah had 12 offers. Truly a special house.