And that’s the county, which is huge. I’ll bet that house for $239K was forty miles out of L.A. proper, in Palmdale or some place like that.
390K for a condo isn’t expensive either.
In my neighborhood the median home price is $840,000, LA county median is 540,000. Condo median in my neighborhood, 674,000, county median is 432,000.
There are 600sq ft condo’s that just last year used to be apartments down the street from my apartment complex that are starting at $240,000.
What I don’t understand is the gang-banger, thuggy lifestyle really an upscale “choice” for misunderstood southern californians? You see these types roaming the neighboorhoods in parts of LA but the price of the real estate they hang out in starts a half a million. Where do these people live? Two years ago my brother and I were checking out places in NY. That night we went to a “biker” bar located on a block where the day before we had seen condo’s that were $1000.00 a sq foot. Looking at the rough stuff hanging at neighboorhood type bar, I kept wondering what the hell these jean and wife beater wearing types did for a living to afford to live around there.
NYC has the rent stabilization system, which limits rent increases for current residents and goes a long way to keeping neighborhoods economically mixed. In NYC it’s entirely possible to have a maid and a stock broker renting in the same apartment building. AFAIK, there is no such system anywhere in LA, but if I’m wrong I’d love to hear about it.
LA county itself has rent control, but some of the incorporated cities do not. I believe the increase cap is 3% per year, but I’m not certain on that.
ETA - After checking, I see that the cap is 4%.
As an anecdote, I saw an episode of one of the “house flipping” shows (possibly the same show the OP saw) and the guy had bought a home in Compton to flip. It was one of those very tiny homes with bars on the windows and whatnot. I don’t recall the price but it was about in line with the $300k+ everyone is talking about.
Anyway, his idea was not only to make a profit on the house, but make a profit by bringing some wealthier people out to Compton to establish the community a bit more (dude was from Compton himself). He wasn’t really looking to sell to Joe and Jane Whitey who just relocated from Milwaukee, but to people like himself who had grown up in the area and wanted to return, but return to something nicer.
Bah, I have to correct this post again! It is the city of Los Angeles with the rent control, but that does cover a large portion of LA county. Some other cities in LA county have passed rent control acts as well, but not all of them.
I know people living in western Riverside County. What I hear from them is that the folks from Compton, South Gate, Paramount, etc. are starting to figure out that they can sell their small run down homes for a nice chunk of change, then move to Riverside County (e.g., Lake Elsinore, Temecula, Perris) with some cash to blow on nice cars.
That’s exactly what’s happening. A lot of the gang activity has moved out there with some of them.
In 1997 I bought a 50 y.o., 800 sqft house in Encino (“north of the blvd.”) for $129,000. Two years later I sold it for $179,000 when I moved out of state. A friend of mine in L.A. told me it just sold for $739,000. Wish I could’ve afforded to hold on to it, but I needed the money to buy here.
Yeah, it doesn’t get that hot in the basin. I live on the west side and I turn my air conditioning on three or four times a year. I could easily make do without.
It’s a bit of a different story in the Valley or the Inland Empire. It’s much hotter the further from the ocean you get.
In my neighborhood 1000 square foot houses are going for over a million now. That’s why I live in a condo … .
Actually, from what I understand, the market in Texas hasn’t run up too badly at all. I know a couple people who moved from California to Texas and bought really nice houses for a price that wouldn’t even get you a shack here. In fact, Austin was mentioned in an article today as one area where prices didn’t overheat, and which is therefore still a strong market.
Yes. Although “afford” is the wrong word. They can’t really afford it, which is why defaults are way up (and I suspect this is just the tip of the iceberg).
Exactly. They gave them loans anyway. That’s why there’s a crisis with subprime lenders now.
I just saw a piece on one of our local news stations about the price of condos in downtown Seattle. A four hundred square foot condo was going for over $400,000. That’s just freakin’ nuts.
With all the talk of the real estate downturn in the last year, it still just floors me when I see the asking price of homes. My own neighborhood is a perfect example. We all bought our homes new, four years ago. Prices ranged from low to mid 200s. A neighbor a few doors down just sold his home for around $375,000. I can’t believe he got that much.
Less than 5 years ago, I bought a 3500 square foot 5 bedroom home in a Houston suburb for $180,000. Yeah. Texas real estate can be had for WAY below places like California.
No way that was the whole county, that listing had to be restricted somehow. I live in Lancaster (a little north of Palmdale, where **Spectre **mentioned) and new McMansions are going for not much more than that. Husband and I went model browsing and they were begging us to buy a home (5bed 4bath 3car, $325,000). Often, freeway-side signs out here listing new homes have the price range blocked out and then repainted with a lower range. Compared to the rest of the county, they’re practically giving them away.
It is quite possible to go cheaper than that. I console myself with the fact that everyone’s 5 year ARM will be expired about the time my husband’s done with law school. (Also, it’s much hotter here than in the LA Basin, and central A/C is an option here often).
So before long the South Central LA of rap and Boyz N the Hood fame will be a bunch of subruban types 
I share your puzzlement, because it sure as hell ain’t so that “almost everyone is making 6 figures and beyond”. In fact, only about 17% of all US households have household income above $100K, while the US median household income is somewhere in the mid $40K’s.
Presumably homebuyers in expensive localities are overrepresented among that high-income 17%, but I can’t see how “almost everyone” even in the homebuyers-in-expensive-localities subset could qualify. As lowbrass notes, a good part of the answer may just be that lots of folks are buying homes they can’t afford.
Yes but why the hell would lenders do that? Sure they get the houses in an overinflated market, but soon those homes are going to depreciate.
Thanks for your help,
Rob