Will L.A.'s Real Estate Bubble Burst?
"Let's start here," Ross Novie says, as he steers his Honda onto Federal Avenue. He and his wife Agnes want to buy a home. It's Sunday. They're trolling the open houses.
Between them, the Novies bring in more than $100,000 a year, which puts them in the top fifth of wage earners in California. They're looking to spend around $450,000, and they're hoping to stay on the Westside, near Ross' job as an assistant director on the Fox TV comedy "Arrested Development." The couple are prepared to buy a house that needs some TLC, but any renovation work will have to be finished by the spring, when Agnes, 36, gives birth to their first child.
"People say you have to have reasonable expectations," 32-year-old Ross says. "I think we do."
They drive south and east through West L.A., past rows of low-slung stucco houses, some well-kept, others shabby. Ross occasionally peeks at a page he has torn out from the newspaper, with three or four ads circled. But before they reach any of those houses, he spots a sign. It's on Granville Avenue, north of National Boulevard, in front of a smallish, nondescript house. "Ah!" he says. "I do get a kind of bitter joy when I see an open house sign." He pulls over.
"It'll be $500,000," he says as he climbs out of the car.
"$650,000!" bets Agnes.
Just inside the entryway they find a flier. The owner wants $699,000. Agnes rolls her eyes. Ross takes about a millisecond to look around the house. It is freshly painted and has hardwood floors and built-in shelves. "This is nice," he says. "But this is for wealthy people."
They turn and walk back out the front door. A small plane, following the flight path into Santa Monica Airport, buzzes the little house. It sounds like a dive-bomber closing in.
Everyone knows that the housing market in Southern California has gone, if you'll pardon the pun, through the roof. As of August (the most recent figures available), according to the California Assn. of Realtors, the median price of a home in Southern California was up sharply from last year:
* Los Angeles County: up 24%, from $300,980 to $374,720
* Riverside and San Bernardino counties: 28% to $ 231,300 (numbers from July)
* Orange County, 20% to $523,600
* Santa Barbara County: 18% to $479,540
* San Diego County, 17% to $444,230
- Send Us Your Story for My House/My Life Jan 07, 2001
- Alva Herd; Automobile Dealer and Real Estate Broker May 01, 1997
- Housing Sector to Stay Healthy, Experts Say Nov 17, 1998
