Los Angeles Luxury Homes
“Safe as houses,” is an old adage that illustrates the relative safety of real estate as a store of value or investment vehicle, compared to other investment options. That statement is as true today as it was a hundred years ago, and according to a recent article on Bloomberg.com, investors both foreign and domestic are taking advantage of the Los Angeles luxury real estate market.
Here are a few highlights found in the article.
- 7,383 homes in California sold for $2 million or more last year. That’s a 33 percent increase from 2012.
- Absentee owners – owners who do not consider a home their primary residence – bought 27 percent of the California’s $1 million and up homes, 39 percent of similar Beverly Hills houses, 42 percent of Bel Air homes, and 45 percent of West Hollywood houses.
- Los Angeles home prices are still 22 percent below their 2006 peak but have risen 35 percent since the low in 2009.
- International investors are also interested in modest properties on the outskirts of Los Angeles. East Asian investors accounted for 53 percent of new homes sold in Irvine, CA.
- Los Angeles trails behind only New York City in terms of international investment in real estate.
Los Angeles luxury real estate has long been seen as an excellent way to protect assets and diversify a portfolio by well-heeled, domestic investors. Now, foreign investors are realizing the benefits of investing in Los Angeles real estate too and a driving force behind the lack of supply crisis.
In order to capitalize on this new segment of the luxury home buyer market, it’s important for those seeking to attract foreign buyers when selling a home in Los Angeles to remember that many of these buyers view Los Angeles real estate as an investment, not a lifestyle choice. They may never spend a single night in their new property.
This can affect how you and your LA real estate agent choose to market your property.
Remember, the many luxury features of the home may play a smaller role in a foreign investor’s final decision as opposed to someone who plans to live in the house. The investor’s decision is likely to be made on the potential profit and loss sheet rather than on a stunningly appointed master suite.
In order to successfully market a home in Los Angeles premiere neighborhoods such as the Hollywood Hills, West Hollywood, Beverly Hills and the very sought after “Bird Streets” to foreign investors, it’s important to emphasize first the stability of the market and the fact that home prices in the area are rising – offering a safe but potentially lucrative investment. Another major decision in purchasing a property is the rentability of a house and if the rental price brings a good return.
If you are planning to sell your luxury home in Los Angeles and would like to discuss how you can better market your home to potential foreign investors, please feel free to contact me at 323-829-8811.
Susan Andrews | Estates Director
BRE License #01425843
Susan Andrews is your ultimate real estate source for Los Angeles, California and surrounding communities.
Photo courtesy of Bloomberg.com.