Los Angeles real estate is undergoing a fast-paced and continuous growth. With more homes and developments being built, prices increasing, and more buyers entering the market, it’s crucial to stay informed of significant trends on the rise.
Stay ahead of the curve and be prepared for these 12 real estate trends expected to be on the rise in 2017.
1. Millennials Buying Homes
More millennials — roughly, those born between the early 1980s and the late 1990s — are expected to buy a first home in 2017, according to the Washington, D.C.-based National Association of Realtors. At the same time, Los Angeles millennials are trending away from the city of Angels and moving east.
2. Rising Interest Rates
The majority of the Federal Reserve’s rate-setting board members are predicting rates will rise 3x in 2017. But don’t fear; while mortgage interest rates may increase, they’re not expected to go higher than 4.3 percent on the 30-year fixed rate — still far below historical norms.
3. More New Construction
As developers are encouraged by higher wages, less credit regulation, and increased demand from buyers, we expect to see more new homes being built.
4. Cash Is Still King, But Getting a Mortgage Is Now Easier
According to the Mortgage Credit Availability Index, it’s easier to get a mortgage now than any other time over the past eight years and, under the new administration, we expect this to get even easier.
5. Los Angeles Home Prices Will Continue to Increase
While most of the country is leveling off, prices in Los Angeles will continue to rise in 2017. Real estate site Realtor.com ranked Los Angeles second out of America’s 100 largest metro areas in a report on national home sales trends. The report predicts that LA-area home prices will rise by 6.9 percent and a number of home sales will increase by 6 percent in 2017.
6. Smart Homes Becoming Talking Homes
First there was Amazon’s Echo, then Google Home, then Microsoft’s HomeHub and now Facebook CEO Mark Zuckerberg is teasing his goal to create a home-running AI similar to Jarvis from the Iron Man series. These futuristic devices, which act like human assistants, respond to your voice and do everything from alerting you to traffic to reading you the day’s headlines to playing your favorite shows on Netflix.
7. Third Homes
With real estate continuing to be a safe haven for one’s money and the desire to travel and simply getaway, Angelenos are snapping up second and third homes ranging from within driving distance of their primary residence to across the globe. Two hot spots we’re seeing most are Malibu and Park City, Utah. Malibu offers some of the most beautiful and secluded vacation properties in the United States mere miles from the bustling neighborhoods of central Los Angeles. And, an easy drive from Salt Lake City International airport, Park City boasts easy access for part-time residents and a host of outdoor adventure, from skiing to fly fishing and some of the best golf in the West.
8. Foreign Investors
China’s growing debt problem is very real and of major concern to both institutional and individual investors abroad. Many are doing everything they can to diversify their assets and are readying themselves to move as much as they can to markets such as the US, Australia, Europe, the UAE and South America. Los Angeles is likely to see a surge in foreign investors as a result.
9. Surge in L.A. Public Transportation
With the recent opening of the Metro line connecting Santa Monica to Downtown, Proposition M passing for the new rail and new stops opening around Los Angeles with the mayor’s support, there is undoubtedly going to be a surge of public transportation as it becomes increasingly convenient to leave your car at home.
10. Vertical Living
Los Angeles continues to draw the likes of east coast and international transplants with the desire to live in California for the same reasons we do, the weather, food, art, lifestyle and well — on the world’s stage, our prices are lower than New York, London and Hong Kong. Where will they all live? The only answer is “up.”
11. Commercial Development Will Continue to Boom
With the frothiness of the market pre-Trump, talk of deregulation of Dodd Frank, more disposable income and less taxes, there will be a bump in the euphoric attitude toward the marketplace. With this there will be more liquidity and more of a demand for people to invest in real estate, including commercial developments.
12. The Color Green
Pantone released its 2017 Color of the Year: Greenery, representing refreshment and revitalization. We can expect to see this color splashed on more walls in 2017 than in years past. Another color to be on the lookout for: Raw White.