Whether you are looking to relocate to Los Angeles or buy a home in the city for the first time, you face similar challenges navigating the market. Our L.A. Home Buyer’s Guide is a great place to start for help. After giving that a read, this provides a more specific roadmap to first-time buyers in order to make your task less daunting.
What you can expect to pay
The median price in the city is $632,000, up 7.6% over the last year, according to Zillow. Back in May, the Los Angeles Time noted the median price climbed back from the depths of the housing crisis, reaching the all-time high set back in 2007. According to the L.A. Times, home prices rose almost 6% in April versus a year ago, to $550,000.
The city is characterized as a seller’s market. Therefore, with low inventory levels, you should be prepared for the possibility of several offers on a house you like.
In terms of financing, similar to New York City, you should obtain pre-approval from your lender prior to home shopping in order to make your offer more competitive. You may be competing with all-cash buyers, after all.
A neighborhood for you
Los Angeles is a sprawling city of about four million residents, the second most populous in the United States. However, Greater Los Angeles Area has a far bigger population of about 13 million. There is the economic opportunity offered along with the glitz and glamour of Hollywood, fine educational institutions, and cultural attractions. The Greater Los Angeles comprises five counties (Ventura County, San Bernardino County, Riverside County, Los Angeles County, and Orange County).
Combing through 4,850 square miles can be daunting. We suggest you narrow your scope down to a couple of different LA neighborhoods based on your wants and budget. You can do some homework on your own. For instance, if you have a family, examine the school district and take a walk around the neighborhood to see if there are similarly aged children. Social media can clue you on things such as community events to see if the activities interest you.
Two areas that receive a lot of attention are downtown and the Westside.
Downtown has attracted first-time homebuyers, particularly young people. It is flourishing, with expensive new developments, such as condos, popping up. There may be retail space in the building, too. The revitalization started about two decades ago, with the Staples Center sports arena opening along with financial incentives to encourage new building. As a result, city dwellers looking for a more urban experience were drawn to the area, which has continued.
Image by Pedro Szekely / Flickr
The West Side, which includes wealthy areas such as Bel Air, Beverly Hills, West Hollywood, Santa Monica, and Mid-Wilshire, typically have homes that sell for upwards of $1 million. This is not too far from Los Angeles International Airport, making it convenient for travelers. There is also a host of tech companies that have a presence.
After you have narrowed down a neighborhood, we can help you find a qualified buyers agent to assist you in your home search.
Preparation is key
One thing you won’t escape is high prices. In fact, it rates as the toughest state in the nation for first-time homebuyers, with factors such as the high cost of housing and a tight supply of entry-level homes mentioned. You should be prepared to spend a larger portion of your income on housing costs than most other places, with Californians averaging over 35% compared to 19.4% for all 50 states.