What are LA’s hottest areas? What are the most sought after ZIP codes in the southland these days? For now, many of Los Angeles County’s hottest neighborhoods fall into two categories: Westside areas in the midst of a tech-industry boom and communities near downtown coveted for their older homes and short drive to an increasingly vibrant city center.
Even with the demand, some of these newly popular neighborhoods are seeing sales fall amid a lack of inventory, but Leslie Appleton-Young, chief economist for the California Association of Realtors, said they are likely to see further price growth. Despite affordability constraints, she’s bullish on Southern California’s housing market for the year.
To gauge L.A. County’s hottest neighborhoods, The Los Angeles Times ranked them by the change in the median price per square foot for a single-family home. So which ZIP codes are up and coming?
Santa Monica | 90402
Median price per square foot: $1,420, +37.5%
This neighborhood saw the largest gain last year. Known for larger homes, the area has long attracted those looking for more space near the beach. More recently, the neighborhood has grown even more exclusive amid a surge of international buyers and executives from the growing Silicon Beach tech hub, said Tregg Rustad, a real estate agent with Rodeo Realty. Also fueling the appreciation are developers picking up smaller, older homes at a premium so they can tear them down and build modern mansions.
Hermosa Beach | 90254
Median price per square foot: $967, +28.6%
Strong demand, tight inventory, good schools and a view of the Pacific made Hermosa Beach a real estate standout in 2015. The small South Bay city also isn’t as expensive as neighboring towns, so wealthy families priced out of increasingly ritzy Manhattan Beach — with its median price of $2.1 million — look to buy in Hermosa, but that’s also pushing up values. Tech workers employed in Venice and Playa Vista are also buying here, searching for schools with better reputations than those in the LA Unified School District, said Nick Peters, president of Engel & Volkers LA – South Bay.
Lincoln Heights | Montecito Heights | Elysian Valley | 90031
Median price per square foot: $419, +28.3%
As one neighborhood grows increasingly expensive, people priced out look the next block over, sparking debate over the gentrification of the working-class communities. This appears to be happening in 90031, which includes Lincoln Heights and parts of Elysian Valley and the more expensive Montecito Heights. Demand in Elysian Valley, a small neighborhood sandwiched between the L.A. River and the 5 Freeway, has been strong, in large part due to investors looking to capitalize on plans to revitalize the waterway.
City Terrace | East L.A. | 90063
Median price per square foot: $307, +23.2%
The hillside community in unincorporated East Los Angeles has seen an influx of demand that has pushed prices up, said Camilo Valentin, a co-owner of Red House Realty Inc. Buyers have been a mix of those from outside the neighborhood looking for a relatively affordable Spanish Colonial near downtown, and former locals who went off to college or left for a job and are returning to put down roots of their own. Investors also are a heavy presence.
Marina del Rey | 90292
Median price per square foot: $737, +23.1%
The flourishing online businesses that have created a wealth of jobs in nearby Santa Monica, Venice and Playa Vista have added an influx of buyers to an up-and-coming area, real estate agent Tami Pardee said. Plus, new restaurants and stores are opening; the county is planning a massive renovation of its maritime, entertainment and hospitality attractions; and housing developers have projects in the works which will attract more buyers.
Manhattan Beach | 90266
Median price per square foot: $1,021, +21.4%
Manhattan Beach long ago ditched its reputation as a sleepy beach town. Professional athletes, tech executives, Hollywood types and other high-income earners are drawn to this city by its beach lifestyle, good schools and gourmet restaurants. But buyers on the hunt for a home find all the competition means there are few for sale and at top prices. Developers are also playing a role in driving up prices, buying a dwindling supply of cottages and throwing mansions up at a rapid pace.
Compton | 90222
Median price per square foot: $264, + 20.6%
Compton was an epicenter of the housing bust as buyers who financed their homes with subprime loans went belly up. But prices have been rebounding for years, as has the city’s reputation. Crime has plummeted and after once shunning the city, large retailers have moved in. Families from the South Bay and Long Beach areas are increasingly looking to Compton for a cheaper home, real estate agent Lulu Robles said. Investors also have scooped up many homes to renovate, lifting values for those properties and the surrounding neighborhood, she said.
Playa del Rey | 90293
Median price per square foot: $636, +20.1%
Real estate in this relatively low-key beach-side neighborhood is red hot due to strong job growth and a lack of homes for sale. In particular, demand is heavy from workers in the growing technology and advertising hubs of nearby Playa Vista, agents say. In some cases, prices — at least on a nominal basis — have risen past those seen during last decade’s housing bubble, agent Jane St. John said.
Toluca Lake | Studio City | 91602
Median price per square foot: $570, +19.6%
The area has long been attractive to Hollywood executives and wealthy families looking to be near elite private schools. More recently, Studio City has become a hot spot for young urban professionals amid an explosion of bars and restaurants. And with all the talk of the Federal Reserve hiking interest rates, real estate agent Matt Epstein said many buyers decided that it was time to make their move. He said developers also are shelling out for older homes to renovate or tear down to build towering replacements.
Have you seen any other SoCal ZIP codes become a hot spot for home buyers?
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