Home to Hollywood and the global film industry, Los Angeles has a Mediterranean climate and a mixture of old and new neighbourhoods. It offers more than 800 art galleries and museums, high end retail areas like Rodeo Drive and miles of picturesque coastline stretching from Malibu to the South Bay.
Los Angeles is a city of renters, with over half of all households rented. This is perhaps unsurprising as Los Angeles ranks as one of the world’s most expensive housing markets: it has the sixth highest average house price of all the cities in this report at $679,200 in September 2018.
This follows five to six years of strong recovery from the last downturn. House prices have now surpassed their pre-crisis peak by around 12%.
The rate of growth is now showing signs of cooling, as increasingly burdensome affordability constraints and rising interest rates is creating a reduction in demand. Despite this, house price growth was robust at 6.4% year on year in September 2018.
Meanwhile, the rental market is performing well. Rental growth accelerated slightly to 3.4% in the year to Q2 2018, as vacancy rates tightened to 3.5%. Both house price and rental growth beat other US cities in this year’s report.
Housing completions also saw the highest increase of all major US cities included in this report. Between September 2017 and August 2018 completions reached nearly 33,000, which is 47% higher than the annual average over the last decade.
Due to host the Summer Olympics in 2028, Los Angeles is developing a series of infrastructure projects to improve transport and connectivity across the city. This is will create many new job opportunities as well as welcome relief to Los Angeles’ traffic congestion.