While this post is dedicated to DTLA, much of it applies to the overall Los Angeles housing market. 10 things to note:
1. Hard to believe that in 1984, average 30-year fixed mortgage rates were over 14%. Rates have since steadily declined, making it much cheaper to borrow money. While 2012 had some real historic lows (3.35!), 2014 is proving to still be super low at about 4.2% YTD.
2. For some buildings in DTLA, the prices have now reached above the height of 2007. Many of those who were under water are now able to sell, but these homeowners are optimistic and are waiting for prices to increase further before selling. With all the new walkable development happening, many homeowners who once had thoughts of selling are now asking themselves, why leave?
3. According to The MLS, the average rent in DTLA for a 1 bedroom was about $2100 in 2009. Average rent price in DTLA in 2014 was $2300 for a 1 bedroom. Higher than the average rent increases plus no rent control is why those who want to have cashflow-positive investments (including me) are buying in DTLA.
4.According to Downtown News, more than 5000 residential units are being built in DTLA in the next 5 years. Of them, less than 10% will be condos. The rest will be rentals. You can bet the demand for condos will continue to be very high in the coming years. And this means higher prices for condos.
5. According to the DCBID, currently there are more than 52,000 residents in DTLA, up 15% from 2011.
6. According to the DCBID, the average income of a DTLA household is $98,700/year. And you wonder why properties are getting really expensive--people with high incomes are buying and renting here.
7. There are more than 20 coffee shops now within a 1-mile radius from the center of DTLA. And most have opened doors in the past 2 years. We all know what that means.
8. The average price per sf in downtown in 2011 was approximately $347/sf. In 2014, it's $546/sf.
9. DTLA has the largest network of the public transportation in all of LA, thanks to the Union Station. The regional connector and the Streetcar will further enhance the accessibility and revitalization.
10. Clean tech incubator labs will soon be inhabiting a reused warehouse in the Arts District. The hope is that DTLA will be the future center of clean technology.
