The Los Angeles Times recently shed some light on the the rise in sales of Los Angeles condominiums. It noted that while sales of single-family homes fell by 7.2% in October, condominium purchases bucked the trend and actually increased by 3.2%.
Several reasons are identified as to why condo sales are surging in Los Angeles, including “changing cultural attitudes” about home buying. But they all would take a back seat to the fact that home prices have dramatically increased in the past year and many people are now priced out of the single-family market. As the Times notes, condominiums are now the only affordable path to home ownership, especially in urban areas.
Richard Green, director of USC’s Lusk Center for Real Estate, told the Times: “People who a year ago could afford houses cant. But they can afford condos.”
While that is certainly the case, the increase in demand for condos is the result of more than just affordability. The story notes today’s young home buyers are much more welcoming to urban living than their parents. Part of that is because they are waiting longer to start families, which makes living in an urban environment much more practical. Places like downtown Los Angeles have become a hotbed for condominium sales.
Despite the increase in demand for Los Angeles condominiums, the Times reports construction of new units “has been remarkably weak across Southern California.” That’s likely to change, however. Rising prices will push construction, especially in the coastal communities, where there simply isn’t as much land to build rows of single-family homes.