Why now is the best time to buy in L.A. and the best neighborhoods to invest in?
With an unstable economy, the global pandemic, and uncertainty about 2021, it may seem like a bad idea to put money into real estate investments. However, most real estate experts agree that now is one of the best times to invest in Hollywood Hills real estate or rental homes in other parts of the city. Here are five reasons why investing in LA real estate is a great idea.
1. Historically Low-Interest Rates
Looking for homes for sale in West Hollywood? When you buy now, you’ll benefit from historically low-interest rates that will make your monthly payments much less expensive than in the past. Current rates hover around the 3% mark for a 30-year mortgage and 2.5% for a 15-year mortgage. One year ago, the rate was 3.7% for a 30-year mortgage. If you’re buying a $1 million home, you would save more than $400 on your monthly mortgage payments if you bought today versus one year ago.
2. The Strong LA Economy
The economy in L.A. has recently been outperforming nearly every other major metropolitan city in the U.S., including New York and Chicago. The growth is measured by the rise in gross domestic product per capita, personal income, home prices, jobs, corporate equity and municipal debt, and global trade and transportation. The strong economy in Los Angeles is good news for real estate investors, as more people will be relocating to the city and all of them will need housing.
3. Prices Are Likely to Keep Increasing
The prices for homes for sale in West Hollywood and throughout Los Angeles have risen by 10.8% in the last year. This indicates that demand for housing has been strong during the pandemic. Though that means you’ll be spending more on Hollywood Hills real estate now, it also means your property will hold its value or increase even more in value, as this trend is expected to continue. As millennials reach the age where they are ready to buy their first homes, the demand for property will increase, driving prices even higher. When you buy Los Angeles investment properties now, you can expect your investments to increase in value over the next few years.
4. The Majority of LA Residents Rent
More than half of the population of Los Angeles rents their homes. In contrast, in the United States as a whole, 64.4% of homes are occupied by those who own them. The high number of renters in L.A. need quality, affordable housing, and this need will remain as people continue to flock to the city for its strong economy, unparalleled entertainment options, and gorgeous weather.
5. Downtown LA’s Revitalization
The downtown area of Los Angeles has recently undergone a major transformation. Even if you’re looking for Hollywood Hills real estate or homes for sale in West Hollywood, you’ll still benefit from this revitalization. New hotel chains and financial institutions flooding the area, new green parks, and the creation of a vibrant art scene that will continue to drive economic development. As the growth and improvement continue in downtown L.A., the number of jobs in the city will grow, as will the demand for quality housing. Those who do not want to buy or rent in downtown Los Angeles due to surging prices will seek out rentals in other parts of the city and the suburbs.
The Best Neighborhoods In
L.A. to Invest InOf course, knowing where to invest is just as important as knowing why to invest. Though there is really no bad place to purchase real estate in the Los Angeles metro, there are some neighborhoods that stand to be more lucrative investments than others. Here are the top nine.
With median purchase prices of $2,309,650 and median rentals at $4,367 per month, the rental prices in Westwood are among some of the highest in the city. Big draws for this neighborhood include Wilshire Boulevard and the UCLA campus.
2. Silver Lake
The average rentals in Silver Lake go for $3,964 per month due to the hip and trendy reputation of this neighborhood.
3. West Los Angeles
With average rentals right under $3,000 per month, West Los Angeles remains popular due to its shopping and dining opportunities. Median prices in this neighborhood have grown by nearly 20% over the course of the year, indicating a strong future.
4. Mar Vista
Rentals average a whopping $4,184 per month in this friendly community located between Culver City and Venice. This is a neighborhood that is constantly growing and improving, making an investment in property a perfect option.
5. Los Feliz
For around $4,471 per month, renters can live in the same neighborhood as actors, musicians, and local artists. You’ll be able to rent your Los Feliz property to one of the thousands of creatives who flock to L.A. to soak in the celebrity atmosphere.
6. Hollywood Hills
Hollywood Hills real estate averages a purchase price of $1,589,467 and a rental rate of $5,529 per month. Secluded in the Santa Monica mountains, homes in this area are quiet and private but still close to the action of the city and are high on the wish list of many renters.
7. Beverly Hills
Rents in Beverly Hills usually top $6500 a month, and for good reason, it’s one of the most famous neighborhoods in the world. If you can afford the median home price of $2.3 million, you’ll be guaranteed climbing values and plenty of interested tenants who want to live among the rich and famous.
8. Santa Monica
The average home for sale in Santa Monica sits at about $1.75 million which makes sense considering it’s one of the most coveted places to live in Southern California. From proximity to the beach and parks to great shopping at farmers markets and the Third Street Promenade, Santa Monica offers the perfect blend of upscale and relaxed.
Owning a piece of Venice real estate will cost you an average of around $2 million. Its urban-suburban feel, plenty of things to do, and eclectic, laid-back atmosphere is a major draw for young professionals and families alike.
Ready to make some smart investments for your financial future? Now is the ideal time to consider buying homes for sale in West Hollywood or Hollywood Hills real estate. With the strong economy, low mortgage interest rates, and plenty of renters for your investment property, the current environment in L.A. is perfect for investors. Work with an experienced realtor like those on the Austin Vaccaro to find the best property for your portfolio.