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Tuesday, Oct 3, 2023


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Staff Reporter

Not all of Los Angeles County is enjoying the housing recovery at least not yet.

While many pockets saw significant increases between 1995 and 1997, prices continued to drop in areas of the San Fernando Valley, Paramount, Huntington Park and the Antelope Valley over the same period, according to Acxiom/DataQuick Information Systems Inc.

And the number of homes sold also fell in Harbor City, West Covina, Carson, South Central L.A., Bell-Compton and Torrance.

“The main pattern is that sales counts and prices went up in attractive neighborhoods before mid-level and entry-level neighborhoods,” said John Karevoll, an analyst with Acxiom/DataQuick.

The recovery, he said, started at the top of the market and only now is starting to migrate down.

Of course, each neighborhood has its own personality, local economy and demographics that may account for drops in property values. But there are common themes: crime, poor schools, plant closures and long commutes.

“You have a lot of areas in L.A. that still have significant problems in terms of equity and safety and environment for living,” said David Parry, a professor of finance and real estate at Cal-Poly Pomona. “If you’re astute, you can find a lot of hidden areas where you could make money. But there are also areas where you could lose your shirt.”

Huntington Park could be one of those places. Median home prices in the largely Latino working-class community fell more than 12 percent between 1995 to 1997, falling from $145,000 to $127,000, according to Acxiom/DataQuick.

Jose Viramontes, an agent with Remax Teamwork Realty, said the decline can be partially blamed on a large development that was built in the late 1980s, when homes were selling for about $200,000. Then came the recession, when many homes were repossessed. They went back on the market for as low as $135,000, he said.

In the city of Paramount, where home prices dropped more than 15 percent to $91,000, foreclosures on condominiums and townhouses purchased in the frenzied market of the late 1980s also could be to blame, said Gary Endo, a broker with Duke & Associates in Paramount.

“Those were people that paid too much,” Endo said.

Parts of the San Fernando Valley, meanwhile, were hard hit by the 1994 Northridge earthquake and subsequent foreclosures on homes.

In Canoga Park, median home prices fell between 1995 and 1997 fell from $120,000 to $110,000, according to Acxiom/DataQuick.

Foreclosures triggered by the earthquake and the closure of the nearby Rocketdyne aerospace plant contributed heavily to that drop, said George Guetzoian, an agent with Century 21 Valley Properties.

Nonetheless, like most real estate agents, Guetzoian remains optimistic.

“Values are back on the upswing,” he said. “The frenzy to buy is going to change the statistics for ’98.”

In general, the hill areas seem to have turned around faster than communities on the Valley floor. Van Nuys, for example, which has older homes and is seen as a somewhat rougher area, saw values in one zip code drop by 10 percent, from $135,000 to $122,000.

The demand today is more for expensive homes, whereas Van Nuys has more in the moderate to low price categories, said Terry Palmer, sales manager with Century 21 in North Hollywood.

“It’s less expensive and (less) sought-after than Sherman Oaks, Toluca Lake or Studio City,” Palmer said.

In the Antelope Valley, home prices in Palmdale and Lancaster have been hampered by a remote location, long commutes and a large entry-level housing market that was hit by the overall drop in values in the early 1990s.

“As prices declined from 1991 to ’94, the homes in neighborhoods that were most distressed were where people owed more on their house than the house was worth,” said Karavoll. “That threshold is crossed earlier in areas where people made low down payments.”

In inner-city areas, the problems are crime and gangs both real and perceived.

“We lost values from 1992 to 1995, post-Rodney King,” said LeFrancis Arnold, a broker at Century 21 in Lynwood.

Even since the recession, the inner-city market has remained flat “because conditions in the inner city really haven’t changed,” added David Dale Johnson, associate professor of finance and economics at USC, citing comparatively high unemployment, low rates of savings and a lack of access to financing.

Indeed, Andy Layman, a Santa Monica-based broker who specializes in Westside properties, recently listed a home in South Central with an eye towards renovating it and selling it at a higher price.

Despite adding a new roof, Layman said, “We’re getting some activity, but not near the demand of the Westside. There are some excellent bargains (in South Central), in the low $100,000s.”

Even though areas with smaller, older homes have not seen the same gains as the high-end market, that may be starting to change, said Karevoll.

Entry-level neighborhoods, he said, “are following an identical pattern (as upper-end ones), but time-shifted forward by a year and a half to two years. Neighborhoods that haven’t done all that well will do well. It hasn’t kicked in yet.”

Staff reporter Joyzelle Davis contributed to this report.

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