Hot areas in Los Angeles area

Specialist · Burbank, CA · Member since 2019 · 15 posts · 9 votes

Hello. I am new in BiggerPockets and believe this is good and trustworthy place to communicate with experienced investors. What are the hot real estate areas in Los Angeles and which type of investment properties are better? Thanks

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Michael T.

Los Angeles, CA · Member since 2018 · 326 posts · 279 votes

@Hovhannes Hunanyan there are a few good areas right now in the Los Angeles area that are good investments.

My two favorite places for investors are in Inglewood and Hawthorne. The gentrification process started in Inglewood two years ago and it will be the next Culver City in 6-8 years. Hawthorne will feel the effects of the revitalization and gentrification of Inglewood and will be the next Westchester.

There are numerous advantages to both Inglewood and Hawthorne.

- no rent control

- "path or progress"

- ability to buy relatively inexpensive compared to the greater Los Angeles area

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Adriel Liwag
Specialist · Los Angeles, CA · Member since 2016 · 165 posts · 88 votes
7y
@Hovhannes Hunanyan
There a lot of hot areas in LA and a lot of investment options. What’s are your long term goals and what type of returns are you looking for? Providing more specific info would help narrow down the best answer to your question.
4 Reply
Hovhannes Hunanyan
OP
Specialist · Burbank, CA · Member since 2019 · 15 posts · 9 votes
7y
@Adriel Liwag
Thanks for your quick respond. I am new in investment although have a lot of book knowledge))) There is nothing specific that I have on my mind, but I am looking at rental property investments
2 Reply
Hovhannes Hunanyan
OP
Specialist · Burbank, CA · Member since 2019 · 15 posts · 9 votes
7y
I always appreciate wise people advise and would like to hear from them. What are the best ways to do if you have home equaty loan on your primary residence and wanna use it for investment. I know there are many ways but I am just wondering what is the best way. For example how would you use $$300,000 home equity ?
1 Reply
Michael T.
Los Angeles, CA · Member since 2018 · 326 posts · 279 votes
7y
@Hovhannes Hunanyan there are a few good areas right now in the Los Angeles area that are good investments.
My two favorite places for investors are in Inglewood and Hawthorne. The gentrification process started in Inglewood two years ago and it will be the next Culver City in 6-8 years. Hawthorne will feel the effects of the revitalization and gentrification of Inglewood and will be the next Westchester.
There are numerous advantages to both Inglewood and Hawthorne.
- no rent control
- "path or progress"
- ability to buy relatively inexpensive compared to the greater Los Angeles area
7 Reply
Joshua Duvall
Investor · Granada Hills, CA · Member since 2019 · 45 posts · 17 votes
7y
@Michael T., that is very good info! Tagging this post for later....
2 Reply
Jonathan W.
Los Angeles, CA · Member since 2019 · 512 posts · 301 votes
7y
@Hovhannes Hunanyan Culver City has gone a long way. Jefferson Park bear USC. And that whole area are places to consider. A lot of older places though so they won’t have central air maybe and also your tax assessment will be sooo much higher then your neighbors but that shouldn’t make or break you. The area has been booming with creative people working for all these industries in La.
I’m not totally up to date on the LA market but I did grow up here and I’ve watched a lottt change
2 Reply
Jian G.
Rental Property Investor · San Diego, CA · Member since 2019 · 102 posts · 43 votes
7y
@Hovhannes Hunanyan
LA is the worst market. So much foreign money investors park their money on 2 cap properties it is overpriced . You can make a blind toss in the map and can do better for your return than LA
2 Reply
Jian G.
Rental Property Investor · San Diego, CA · Member since 2019 · 102 posts · 43 votes
7y
@Hovhannes Hunanyan
But then again you can always find a deal in any market, question is if you where to look and how to look...
1 Reply
Hovhannes Hunanyan
OP
Specialist · Burbank, CA · Member since 2019 · 15 posts · 9 votes
7y
What are the best areas in LA for investment?
1 Reply
Daniel DiPiazza
Flipper/Rehabber · Los Angeles · Member since 2019 · 2 posts · 3 votes
7y
If Ingelwood is on the rise, I'm wondering if Compton is too
3 Reply
Michael T.
Los Angeles, CA · Member since 2018 · 326 posts · 279 votes
7y
@Daniel DiPiazza there have been increases in Compton over the last few years which is great but it has not been as significant as Inglewood. South Los Angeles near USC and further south will continue to have good appreciation along with locations closer to the new stadium in Inglewood.
2 Reply
Endy Segura
Flipper/Rehabber · Compton, CA · Member since 2019 · 3 posts · 2 votes
7y
I believe strongly that Compton is a late bloomer in regards to livability but nonetheless is a strong contender for a 10-20 year outlook for ROI. I've seen enough flips and rentals in the worst parts that are bought/ occupied relatively quickly. Low C and D tenants are moving further and further away from Los Angeles. Compton will be the next Inglewood in the next 10 years.
2 Reply
Eric Carr
Real Estate Broker · Los Angeles, CA · Member since 2017 · 655 posts · 293 votes
7y
@Hovhannes Hunanyan

Agree about Compton, been watching it for the last 6-7 years. Inglewood, Hawthorne, Mid City, View Park, Adams, MacArthur Park, Korea Town, Lemiert Park, all around USC, south of Downtown, Frog Town, Boyle Heights, Highland Park, parts of Van Nuys, Sun Valley. Throw a dart

We have tech companies, two pro football teams, a huge stadium mega dev going up, more talk about the south LA area (think around the Forum) and the purple line going in and more planned over the next 7-8 years, and we will host the Olympics in 2028. LA is in high demand and as someone mentioned, there's a lot of foreign money coming in, which is tightening supply and driving prices up even more. They have the money to sit on property for the next 10+ years for the payout

There's no best, otherwise we'd all be doing it! Find out where you want to specialize, understand the area, zoning, your future plans, RSO, future plans for the area, and devise a strategy based on information.

6 Reply
Mo Brentwood
Los Angeles · Member since 2020 · 5 posts · 11 votes
6y
Absolute best area for short and long term investment if you have enough capital is San Pedro. Last affordable coastal property in Los Angeles. over 1Billion dollars worth of construction in or around the water front is set to begin or be completed in 2020-22. Property that is 500K now will double in 5 years or less. Urbanize LA Articles on San Pedro
6 Reply
Chad Doheny
Investor · Manhattan Beach · Member since 2020 · 9 posts · 11 votes
6y
Gonna have to throw big ups to ma boy @Mo Brentwood for the best answer. San Pedro is def king if you have the cash

Second place goes to @Michael T.
Third place...Set of steak knives
3 Reply
Saul Levy
Member since 2020 · 7 posts · 8 votes
6y
Going to have to agree with the sage advice of @Mo Brentwood and @Chad Doheny here.
San Pedro is THE place to invest right now.
2 Reply
Tanner Marsey
Rental Property Investor · San Diego, CA · Member since 2017 · 439 posts · 578 votes
6y
PEDRO! Bingo. Hawthorne, Inglewood and Compton are all still a gamble. One that, if I had the cash, Id be willing to take but could still go either way.... especially in certain pockets of those places.
2 Reply
Clarence Johnson
Real Estate Agent · Inglewood, CA · Member since 2015 · 294 posts · 150 votes
6y
I favor Inglewood but agree strongly in regards to San Pedro and Hawthorne. Sold my sis and her husband a San Pedro duplex a few years ago when they were priced the same as Watts.
1 Reply
Charles Cooper
Real Estate Broker · San Pedro, CA · Member since 2016 · 206 posts · 89 votes
6y
@Clarence Johnson
I would agree San Pedro is the next best city to buy in. There is a lot going on in San Pedro.
1 Reply
Chris Viglietta
Rental Property Investor · Los Angeles, CA · Member since 2020 · 22 posts · 4 votes
6y
Great thread! Starting to look at San Pedro and Hawthorne. Thank you!
0 Reply
Corina Bousheri
Rental Property Investor · Los Angeles, CA · Member since 2018 · 1 post · 0 votes
6y
@Clarence Johnson I’m hunting for my first purchase and my fingers are crossed for a duplex deal like THAT! Lol
0 Reply
Jacqueline Suarez
Rental Property Investor · Los Angeles, CA · Member since 2018 · 4 posts · 3 votes
6y
@Mo Brentwood Hi Mo, I’m new to the community and looking to house hack in San Pedro. Thinking of purchasing 2-4 units this year. I’ve read on other forums that it is tough with rent control and tenants who love Sam Pedro and never leave. Do you agree with this?
0 Reply
Jon Brown
Real Estate Agent · Pacific Palisades, CA · Member since 2014 · 8 posts · 3 votes
4y
Wondering if anyone has any current advice on this topic. Ty!
0 Reply
Account Closed
Member since 2020 · 983 posts · 1k+ votes
4y
Originally posted by @Michael T.:
@Hovhannes Hunanyan there are a few good areas right now in the Los Angeles area that are good investments.
My two favorite places for investors are in Inglewood and Hawthorne. The gentrification process started in Inglewood two years ago and it will be the next Culver City in 6-8 years. Hawthorne will feel the effects of the revitalization and gentrification of Inglewood and will be the next Westchester.
There are numerous advantages to both Inglewood and Hawthorne.
- no rent control
- "path or progress"
- ability to buy relatively inexpensive compared to the greater Los Angeles area

Funny! Inglewood, Hawthorne, Lawndale and Lennox are the areas I think are the worst, or is it worse. I never did understand whether to use worse or worst. The best areas are the most-desirable since the most-desirable are in the most-demand and everyone knows that when things are in demand their prices appreciate rapidly and sell fast.
Which (or is is what) property or properties will make the most money. Buy 10 homes in Hawthorne for $6.5 million ($650,000 each) or one home for $6.5 million in Manhattan Beach. Generally, the one $6.5 million home will appreciate more than the total appreciation of the 10 homes in Inglewood. Which homes are more-desirable and will appreciate faster? Inglewood, Hawthorne, or Torrance. I will take a home that costs $300,000 more in Torrance, any day, over any home in Inglewood or Hawthorne.
I could be 100% wrong, but probably not wrong, at all. The only way to know is to do the math and compare. Don't forget that you don't make peanuts by purchasing rentals so you can earn a little rent money. The way you make money in real estate is when you purchase properties that appreciate, or purchase properties you can sell for a significantly higher price than you paid.
As stated a thousand times, I just purchased a 6-unit in Hawthorne this past March and it is the worse (or worst) property I own since there is not much room for increasing rents and with no rent increases the property will not appreciate as well as properties in Torrance where I still see major room for rent increases.
As mentioned in many recent posts, two weeks ago a broker called me from San Francisco with a 10-unit in Torrance for $1.9 million. I made a big mistake and told him I was not interested, but I told my broker friend about the property and he has it in escrow. Today, I did the math and figured he will make about $1.5 million in the next 10 years and this is because the current rents are $1500 per unit and he can easily increase the rents to $2,000 which is still a little below the market average for Torrance. You can't find properties in Inglewood or Hawthorne with this much room to increase rents.
Why am I even answering these questions since the OP's heading states that he is a specialist. Specialist, in what?
I attached 3 calculation charts for the 10-unit property in Torrance and 1 calculation chart for a 27-unit property in Torrance where I am guessing we (whoever we is) can make far more than $3.5 million in 10 years because I did not include money earned from appreciation and I always make my projections low since Murphy's Law is notorious for getting the better side of everything.
Not being mean. I hope. If you can show me something good in your areas send me the numbers.
I was searching loopnet.com this evening and I think this 27-unit property has been on the market, or on and off the market for 2 or more years and I may call, mess with their heads and try to get a $500,000+ discount which is hard to do, but I have been lucky in the past and there is some reason this property has been for sale for a long time. I drive by it no less than two times every day and it is a fairly decent-looking building. Always reminds me of a Motel. I might even take a partner in on this one.
5 Reply
Account Closed
Member since 2020 · 983 posts · 1k+ votes
4y
Originally posted by @Jacqueline Suarez:
@Mo Brentwood Hi Mo, I’m new to the community and looking to house hack in San Pedro. Thinking of purchasing 2-4 units this year. I’ve read on other forums that it is tough with rent control and tenants who love Sam Pedro and never leave. Do you agree with this?

San Pedro is another city full of properties with no potential for profit with the exception single-family properties near Cabrillo Beach and 25th and Western toward the ocean, but there is little to nothing to be earned from single-family properties compared to multi-units. Every week, I drive to San Pedro to look at a multi-unit and don't forget about rent control. I can send you 10 properties where the prices are decent, but the market rents are $300 to $400 under market price and with Los Angeles rent control it is impossible to bring the rents up to the market price unless you want to pay your tenants something like $18,000 to move.
It is super easy to purchase and lock yourself into properties that are dogs and then when a goldmine falls on your lap you already tied your cash up with the dog. You have to do the math over and over and over ten different ways. I have three entirely different sets of charts for calculations as in my previous post. I always ask my broker to do the math for me so I can compare with what he comes up with and my son developa his own spreadsheets and he does the math and I compare with everyone to see if I am missing something or made a mistake. I don't have them do the math for me. I have them do the math so I can compare my results. There is a huge difference when you ask someone else to do the math for you and then you give your approval without doing the math yourself.
Do the math and I love to criticize everything and don't trust one thing I say because I could be a real idiot (may be???) and don't trust your broker because we have an old saying, "If you can't dazzle them with intelligence, then baffle them with bullsh...t".
Sorry!!!
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