Homes of Working Class Families in Echo Park (Los Angeles: sales, renters)

[bigpapasmurf76]

I drove through the Echo Park neighborhood when I visited last year, and I had a friend tell me it was a "kind of rough" neighborhood, yet I was shocked at how nice the houses looked (there were some beautiful early-20th century Victorian-style houses). So I was recently perusing the LA County Appraisal website (you can't imagine how bored I was), and I saw some recent home sales in the Echo Park area were in the $400-$800k range (and when I looked them up on Google Maps they didn't look particularly amazing). I know the area has a pretty low average annual income (below $40k a year on average, according to Wiki), so generally speaking, how does that work? In Houston/Austin (where I have lived), households making less than $40k a year usually live in houses typically valued less than $200k or so, so it begs the question-- how did those sub-$40k households in Echo Park get the houses originally and how can they afford to pay the taxes on houses that are worth so much? Not trying to ruffle any feathers, I am just curious what regional differences make it feasible (lower property tax? super-inflated home values in the last 20 years? are most of the houses rentals? etc). I assume I'm ignorant of something unique to the neighborhood or the city generally that would make it a pretty simple explanation.

[jm1982]

You're assumptions are pretty accurate.

The people making 40k a year are not buying the 400k-800k homes. There is no way working class families are buying homes in Echo Park today. Most likely these long time homeowners bought their homes for significantly less than 200k or so. It's even possible they bought for under 100k.

Though it might be possible some of the people making 40k bought homes years ago when the prices were much lower.

Echo Park has become one of the hottest if not the hottest 'hipster' neighborhoods in recent years. Prices have been going up and up. If you are looking over 20 years in Echo Park properties have gone up many times. There used to be a much bigger problem with gangs in the neighborhood. Things have gotten significantly better.

Regarding property taxes they are cheaper than Houston and Prop 13 in CA keeps taxes relatively low
http://en.wikipedia.org/wiki/Califor...ition_13_(1978)

I think Boyle Heights is likely to be one of the next neighborhoods to gentrify. it's proximity to downtown makes it a very good candidate. Homes there are not super cheap, but they are a lot less than Echo Park.

[bigpapasmurf76]

Thanks for the info, especially about Prop 13!

[jm1982]

No problem

[BayAreaHillbilly]

There are hundreds of Echo Parks in coastal and near coastal CA.

Welcome to Bubble 2.0!

[jm1982]

Bubble ... But the news tells us the time to buy is nowwwww

Even if it's a tiny shack for 600k

[saybanana]

Echo Park Profile - Mapping L.A. - Los Angeles Times

If you look at the LA Times profile for Echo Park, 74% of people are renters with an avg income of under $40K.

[Ceece]

I really love Mapping LA but the census info is 13 years old and the city planning info is 5 years old so I really wonder what the new reality is. Some of these areas have changed so much in 2-3 years.

[quixotic59]

Great thread. Happened to take a drive through Echo Park yesterday and was wondering the same thing as the OP.
It looked like it could have problems but at the same time some streets had a nice look about them.

[buzzkillb]

As an example of where I live our neighbors across the street bought for $95k in the 90's. From what I can figure out based on amount of cars and people I see living there, there are at least 9 people living in this 950 sqft. house. Fast forward to today and the houses on the block can sell for $450-500k quickly, last go around the houses peaked in the $600k range. We don't live in a hipster trendy area so I can only imagine that something very similar is going on in Echo Park, only add just how hot certain markets are around Downtown. I could see younger couples moving into Echo Park as they see the prices continue to skyrocket. And there is some reasoning to this as being close to Downtown is fashionable. I also think younger couples are more willing to put up with the grime of being in these areas. We paid a lot to live in a loft in Downtown for a year.

The older houses look great. Most of the flips are pretty decent. Put the bubble prices and frenzy with that and you get places like Echo Park. If that continues and creates a new price range for the area, eventually the whole area will have newer home owners than what is probably there.