How cheap was LA?

[brianbar]

While I haven't dug up a ton of data, the cost to enter the market, as a new purchaser or even renter, is much greater than the average median salary, around 67K/year, would afford for a single person in LA. As a couples it seems more doable but not reasonably doable- a 650K plus mortgage with 10% down and PMI would pretty much preclude saving and investing and some other general quality of life luxuries if you will. The current median home price cannot comfortably and reasonably be afforded at these salary levels- for new entrants especially. This leads me to believe a relatively large piece of the population has been established, or otherwise owned for a considerable amount of time, at least a decade, when prices were at least 20% less and perhaps buying in the late 90s or early 2000s.

[skygazer1]

Originally Posted by brianbar

While I haven't dug up a ton of data, the cost to enter the market, as a new purchaser or even renter, is much greater than the average median salary, around 67K/year, would afford for a single person in LA. As a couples it seems more doable but not reasonably doable- a 650K plus mortgage with 10% down and PMI would pretty much preclude saving and investing and some other general quality of life luxuries if you will. The current median home price cannot comfortably and reasonably be afforded at these salary levels- for new entrants especially. This leads me to believe a relatively large piece of the population has been established, or otherwise owned for a considerable amount of time, at least a decade, when prices were at least 20% less and perhaps buying in the late 90s or early 2000s.

So what's new? This has been discussed at length on various posts in the SF and LA forums.

[CA4Now]

Originally Posted by brianbar

the cost to enter the market, as a new purchaser or even renter, is much greater than the average median salary, around 67K/year.....- a 650K plus mortgage with 10% down and PMI would pretty much preclude saving and investing and some other general quality of life luxuries...The current median home price cannot comfortably and reasonably be afforded at these salary levels- for new entrants especially.

New entrants used to look at condos, fixers, and starter homes, not median priced homes. Not sure why that would be any different today. Most starter/fixers are priced at well under $ 650 K, unless one is looking at exclusive neighborhoods.

Originally Posted by brianbar

This leads me to believe a relatively large piece of the population has been established, or otherwise owned for a considerable amount of time, at least a decade, when prices were at least 20% less and perhaps buying in the late 90s or early 2000s.

Many first time buyers bought in around 2012, when the housing market was at its last low...only 7 years ago.

[expatCA]

Originally Posted by CA4Now

New entrants used to look at condos, fixers, and starter homes, not median priced homes. Not sure why that would be any different today. Most starter/fixers are priced at well under $ 650 K, unless one is looking at exclusive neighborhoods.



Many first time buyers bought in around 2012, when the housing market was at its last low...only 7 years ago.

In checking the records well over 2,000,000 homes sold in SoCal in the last 10 years.


https://www.ocregister.com/2018/12/2...four-year-low/

[skygazer1]

Originally Posted by CA4Now

New entrants used to look at condos, fixers, and starter homes, not median priced homes. Not sure why that would be any different today. Most starter/fixers are priced at well under $ 650 K, unless one is looking at exclusive neighborhoods.

The median is the median, there's plenty of homes under the median as there are over the median. The coastal parts of LA have the highest prices, and difficult to impossible for most first-time buyers. Inland areas are more affordable, if you are willing to do the long commutes, the air pollution, the hot summers.

Fixers represent a bit of a problem, because many cannot be loaned with FHA, or even conventional. The loan options on those are much more limited, and require larger down payments, better credit scores, licensed general contractors and high rehab costs.

[CA4Now]

Originally Posted by expatCA

In checking the records well over 2,000,000 homes sold in SoCal in the last 10 years.

https://www.ocregister.com/2018/12/2...four-year-low/

What is your point here, expat? (And there's a paywall on your link.)

[Granite60]

My husband and I left California in 1993, not because of the riots that you mentioned but he retired and we wanted a life of camping and boating and we moved to Lake Havasu City and the best years of my life were there. We boated and camped during the summer. We had all kinds of friends and we lived each day as if it were our last. We owned our house there for three years before retiring and we hated to drive back to Los Angeles. My husband is now deceased and I wish I lived back in Los Angeles but you are right I could not afford either of the houses we owned. All of the Californians are moving here in Prescott, mass groves of people moving here. I would not give up our times boating on LaKe Havasu and fishing. Loved our life there, not in Los Angeles.