is it, you have
basically answered you own question with the question. The whole south
of the United States has been devastated by the housing crisis, but the
areas where overbuilding and jobs losses were more prevalent got hit the
worst (California, Nevada, Arizona, Texas and Florida). The northern
manufacturing states like Michigan and Pennsylvania got hit hard too,
but they will not recover very soon and are not the best locations for
investing in real estate yet, although that can change at any time. If
you are interested in the northern areas, keep a close eye on the news
and job recovery statistics.
Because the housing
market has taken such a big hit over the last four to five years that
means that prices are at decade lows for existing homes and the full
retail price of new construction is also at decade lows (although square
foot on square foot you will pay more for a new construction home).
If you have any
handyman type of skills you can even get better prices on existing homes
that are slightly and lightly neglected while they have been sitting in
a lenders foreclosure inventory or while the owner has been challenged
with trying to sell the property.
first reason why property in Los Angeles County is a good deal now, is
because it is financially a good deal now. On average the homes
in Los Angeles county have lost 26% of their value over the last 5
years. This is across the board with the more upscale properties to the
north and in the hills losing even more. These losses equate to profits
for the next person that will be the owner of any of these properties.
Just because a property has lost 25% to even as much as 50% of its
equity does not mean the real and true value of the property has
evaporated, in California the prices normally recover eventually. This
is not the same for all parts of America, but it is true for California.
trends is one of the strongest factors that effect home prices. This
is a factor that is directly associated with housing availability. It
is just simple math, more people, more housing needed. More housing
needed the higher the demand and the higher the price per unit.
California and specifically Los Angeles county is a location with a net
increase of population. Even though the housing market is not seeing a
turn around this very minute, it is only a matter of time until demand
outpaces the supply.
trends also have a major impact on housing demand and also prices.
Los Angeles county is one of the few regions in America that have
already started to show signs of economic recovery in all sector of the
economy from manufacturing to construction. The population is increasing
at a very steady rate and unemployment is dropping at also a steady
rate. People are going to California for a reason and that reason is
pretty obvious if you take the time to look at the big picture.
When you take the
time to consider all that the State has to offer and you also take the
time to imagine and consider why so many people are moving to, returning
to or relocating to California then you can see that this is a location
that many tens of thousands of people see as a location that holds
promise for their futures and the futures of their families.
They are willing to
sell the farm and move to Burbank or Hollywood. They see that the future
is bright in sunny California. The new governor has pledged to balance
the State budget to the tune of $25 Billion dollars within only 18
months. That is a huge undertaking in its own right. Things look really
good for people in and people considering relocating or repatriating to
I cannot blame any
one of them for making the move and I could not with any conscience
offer an alternative that is better.
This is a great
example of how popular California is, 99% of Americans only know two zip
codes, the zip code where they currently live and a little pocket of
people that live in Beverly Hillsâ€¦. 90210.
When you consider
how severely the residential retail housing prices have dropped, the
mass exodus of people from California over the last 5 years, the influx
of people returning to California because of the recovery in employment
and the overall economic â€œbig pictureâ€ and you throw them all in a
blender and hit puree, the thin red paste you pour out will spell
financial success over the next few years if you have the ability to buy
a residential property within the first half of this year.
The key to your
success is to either have an intimate understanding of the market you
are interested in (Burbank is not the same as Hollywood or Encino) or to
find a Realtor that is extremely and intimately familiar with your area
The downturn in the
housing market has not only produced some of the best real estate values
in years, it has also produced some of the best Realtors of our life
time and you would be foolish to not take advantage of their skills,
experience and expertise.