Is LA affordable if you're okay with low sqft?

[Outer_Bluegrass]

If you rent an apartment-style condominium from a private homeowner in the Los Angeles area, then your rent will be significantly lower than if you rent an equivalent unit in an apartment complex that is owned and managed by a large corporation. Usually, private landlords in the Los Angeles area increase rent prices much less frequently than corporate-run apartment complexes and have the flexibility to rent their homes at below-market rates, especially if the property has no mortgage and low property taxes and HOA fees. When you rent homes at below-market rates, you tend to attract a wider array of prospective tenants, including those who do not *have to* pay above-market rates due to felony convictions, low credit scores, poor rental history, limited verifiable income, aggressive dog breeds, lots of dependent family members, etc.

Also, since the Los Angeles is highly segregated by race and ethnicity, I have found that private landlords often show preference to prospective tenants of the same race/ethnicity in an effort to preserve the character and integrity of a certain neighborhood, especially if the landlord lives in same neighborhood himself/herself. Because of this preferential treatment, less qualified rental applicants are often placed in units over more qualified applications (on paper).

[Kings Gambit]

Originally Posted by Outer_Bluegrass

If you rent an apartment-style condominium from a private homeowner in the Los Angeles area, then your rent will be significantly lower than if you rent an equivalent unit in an apartment complex that is owned and managed by a large corporation. Usually, private landlords in the Los Angeles area increase rent prices much less frequently than corporate-run apartment complexes and have the flexibility to rent their homes at below-market rates, especially if the property has no mortgage and low property taxes and HOA fees. When you rent homes at below-market rates, you tend to attract a wider array of prospective tenants, including those who do not *have to* pay above-market rates due to felony convictions, low credit scores, poor rental history, limited verifiable income, aggressive dog breeds, lots of dependent family members, etc.

Also, since the Los Angeles is highly segregated by race and ethnicity, I have found that private landlords often show preference to prospective tenants of the same race/ethnicity in an effort to preserve the character and integrity of a certain neighborhood, especially if the landlord lives in same neighborhood himself/herself. Because of this preferential treatment, less qualified rental applicants are often placed in units over more qualified applications (on paper).

I disagree with much of what is said here. Property owners know the "fair market" rate/value of their properties and tend to want to rent/lease those properties at or very near the market rate. They are NOT going to want to lease those out at significantly lower prices than comparable properties.

Also, LA is NOT "highly segregated by race and ethnicity". I'd say more along the lines of the affluent and non-affluent. I live in what is considered a very affluent area and on any walk/skateboard around my neighborhood, I run into neighbors from all races and walks of life. Even going into any restaurant or retail store, its a very very mixed area. This is true from what I have seen in over 20-25 years in Burbank, Glendale, Studio City, Sherman Oaks, Encino, Woodland Hills, North Hollywood, Brentwood, Culver City and Santa Monica.

Another downside to renting/leasing from private owner (i.e., renting a condo or a home) is that with larger corp owned properties, you basically have to do something negative/bad to have them no renew your lease. With privately owned (condo/home) the owner can just one day decide he/she wants this property for a family member, friend, or decide to sell so you are at their mercy instead of your own.

[CA4Now]

Originally Posted by Kings Gambit

Another downside to renting/leasing from private owner (i.e., renting a condo or a home) is that with larger corp owned properties, you basically have to do something negative/bad to have them no renew your lease. With privately owned (condo/home) the owner can just one day decide he/she wants this property for a family member, friend, or decide to sell so you are at their mercy instead of your own.

Exactly. I've seen this happen many times to friends and relatives. And it isn't always easy for them to move out within the landlord's timetable.

[Veritas Vincit]

A small apartment in L.A. isn't relatively speaking any more affordable than a large apartment or a single family house if compared to similar housing in other markets. And the basic fact that a studio apartment is 'more affordable' than a 3 bedroom house is something even a child can figure out, and certainly not worth being pointed out.


Whether something is 'affordable' always depends on your income anyway..and there's people for whom $1500 a month in rent is not affordable. Consider the general guideline that rent should be no more than 30% of gross income, so at $1500 a month that's $18,000 a year, that's $60,000 a year. Are there no people in L.A. who make less than 60k? I suspect there are. Of course if you make $150,000 a year then that's a pretty cheap rent. It turns out that, surprise surprise, if you make good money, real estate is more affordable. What a revelation.

[ohio_peasant]

Originally Posted by Kings Gambit

Also, LA is NOT "highly segregated by race and ethnicity". I'd say more along the lines of the affluent and non-affluent. I live in what is considered a very affluent area and on any walk/skateboard around my neighborhood, I run into neighbors from all races and walks of life. Even going into any restaurant or retail store, its a very very mixed area. This is true from what I have seen in over 20-25 years in Burbank, Glendale, Studio City, Sherman Oaks, Encino, Woodland Hills, North Hollywood, Brentwood, Culver City and Santa Monica.

I disagree with your disagreement... One can find maps of ethnic distribution by zip code, probably even on this site (I'm too lazy to check). Also maps of public school enrollment. These can be taken as discriminatory, or not... depending on one's agenda.

Most of the sub-cities or areas that you cited, are indeed more or less diverse, with the exception of Glendale. Now consider if instead you chose Boyle Heights, Lincoln Heights, Cypress Park, or El Sereno. Or Alhambra, San Gabriel, Hacienda Heights, Montecito or El Monte.

Originally Posted by Veritas Vincit

A small apartment in L.A. isn't relatively speaking any more affordable than a large apartment or a single family house if compared to similar housing in other markets. And the basic fact that a studio apartment is 'more affordable' than a 3 bedroom house is something even a child can figure out, and certainly not worth being pointed out.

The point is that the curve of rental price vs. square footage is very nonlinear. If you're going to rent a 1000 sq ft apartment, well, might as well consider buying a [small] house, because your rent will be high. A 350 sq ft studio on the other hand is indeed "affordable", in the sense that a comparable condo, if it exists, will be most costlier.

There's obviously a price-premium in LA vs. say the Midwest, for any housing. But this price premium is also nonlinear. For larger apartments, it's going to be large. For smaller ones, not as large. Phrased another way, there's something like a national floor for renting the smallest, crappiest apartment. In the most woebegone city in the Midwest, it's probably not going to be possible to find the tiniest and most lamentable rental unit for under say $500/month. In LA, you'll pay maybe triple that, possibly a bit less. In the same Midwestern city, but a very cheap one, a spacious and comfortable unit might be $1000/month. In a "nice" building in a "nice" part of LA, that's going to be $5000, perhaps. So as one goes upmarket, to larger dwellings and better areas, the price difference increases. The lesson is that for a middle-class family that wants the best schools and a prestigious area, the LA cost premium is large. For a single-guy who doesn't mind trash, graffiti or the occasional street altercation, who doesn't care about schools or prestige or safety, LA offers some decent deals on the low-end.

[CA4Now]

Originally Posted by ohio_peasant

The point is that the curve of rental price vs. square footage is very nonlinear. If you're going to rent a 1000 sq ft apartment, well, might as well consider buying a [small] house, because your rent will be high.

Yet there's the rather major issue of coming up with the down payment if you buy. Which is considerable, given the median price of a "small house" in Los Angeles. And which is why many people continue to rent.

[jvalens]

Originally Posted by Kings Gambit

Also, LA is NOT "highly segregated by race and ethnicity". I'd say more along the lines of the affluent and non-affluent. I live in what is considered a very affluent area and on any walk/skateboard around my neighborhood, I run into neighbors from all races and walks of life. Even going into any restaurant or retail store, its a very very mixed area. This is true from what I have seen in over 20-25 years in Burbank, Glendale, Studio City, Sherman Oaks, Encino, Woodland Hills, North Hollywood, Brentwood, Culver City and Santa Monica.

Originally Posted by ohio_peasant

I disagree with your disagreement... One can find maps of ethnic distribution by zip code, probably even on this site (I'm too lazy to check). Also maps of public school enrollment. These can be taken as discriminatory, or not... depending on one's agenda.

Most of the sub-cities or areas that you cited, are indeed more or less diverse, with the exception of Glendale. Now consider if instead you chose Boyle Heights, Lincoln Heights, Cypress Park, or El Sereno. Or Alhambra, San Gabriel, Hacienda Heights, Montecito or El Monte.

Hmm, I agree with Kings Gambit, that L.A.'s segregation is more based on income than ethnicity/race. I haven't looked at the data maps, this is mostly based on every day experience of people I see on the streets, in stores, restaurants, etc.