LA – Selling Fast

As the end of 2012 approaches, the Los Angeles infill residential market continues to see increasing momentum in both new home sales and demand for new land development.

Much of the demand for new projects in the Los Angeles basin stems from the steady flow of new home sales at projects throughout the county.  In particular, there are several townhome projects in the San Gabriel Valley including Azusa, Baldwin Park and Covina that have seen absorption rates in the four to six units per month range.  In Northeast Los Angeles, Pulte’s Mosaic, Heyday’s Buzz Court look to be on pace to selling out around the New Year, while Williams Homes Olive Glen project in the South Bay was named the fastest selling community in the southland.

Buyer demand for new attached or detached homes is triggering, both builders and developers, to get more aggressive when it comes to land deals. Many are even considering B and C locations. While there is not a significant supply of developed lots available in the infill markets, our team is beginning to see progressively more tract map and permit applications being processed in many cities. Through our vast database Land Advisors avidly tracks deals that are being processed and approved, allowing us the ability to tailor information to meet any acquisition criteria.  Whether it’s 5, 50 or 200 units you are looking for we can guide you to deals that meet your specific goals and needs.

Buyer Demand has triggered both builders and developers to get more aggressive for land deals.

Related Article:

http://ourweekly.com/los-angeles/olive-glen-called-fastest-selling-new-home-community-southland

Source: Chris Gomez-Ortigoza, Marketing Consultant, (626) 378-9840 x14

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Asian Capital Infusion – San Gabriel Valley and Beyond

In recent months, the new home market in Los Angeles has begun to show signs of improvement with increases in absorption rates, higher pricing and improved buyer traffic. These signs are welcome in an unsteady time and can be strongly attributed to the strength of Asian home buyers. You may be wondering, what is special about Asian home buyers?

Cash and lots of it! Whether speaking with sales agents and home builders in Pasadena, Azusa and other cities, it is astonishing to hear the strength of the deals that are being done by Asian buyers and investors. In a survey of actively selling and recently sold out communities, sales agents expressed as many as 1 out of 3 sales to Asian buyers have closed with 50-100% cash down payments. An even larger proportion of sales to Asian buyers have been well in excess of twenty percent cash down payments to purchase homes. As witnessed by Land Advisors Organization, the Asian buyer pool has even begun branching into new home communities in markets that have been traditionally dominated by other ethnic groups including, Northeast Los Angeles and the San Fernando Valley.

With such a strong influence on the new home market, builders that design communities to meet the needs and desires of the Asian demographic have seen above market pricing, brisk absorption and incredible buyer satisfaction.

In addition, Asian investors have been a strong source of capital infusion via the EB-5 financing program. The program allows Overseas investors receive a green card and get on a fast track to US citizenship upon investing $500,000 into a venture that creates jobs. Each $500,000 investment qualifies for one green card if it creates ten Jobs. Hospitals, Assisted living and Hotels are popular investment due to the high number of jobs created, but residential developments are also being regularly financed through the EB-5 program as well.

The following articles both highlight the strength and demand occurring in the San Gabriel Valley and surrounding parts of Los Angeles from Asian home buyers and investors.

http://speakingofrealestate.blogs.realtor.org/2011/04/25/asian-wealth-adds-up-to-u-s-home-sale-boom/

http://www.usatoday.com/money/economy/housing/story/2012-04-03/us-homes-lure-chinese-buyers/53977638/1

Within the past three months, the Los Angeles Infill Team at Land Advisors has marketed three deals in the San Gabriel Valley and continues to see a strong desire for builders and developers to acquire new communities in this area.

For information regarding available deals and market data, please contact Chris Gomez-Ortigoza, Tim Barden or Richard Byrd at (626) 376-9840.

Source: Chris Gomez-Ortigoza, Marketing Consultant

The Metro Gold Line: a Developer’s Gold Mine

This summer, the Construction Authority awarded the Kiewit Parsons Joint Venture, a $486 million dollar contract to complete the Pasadena to Azusa Gold Line extension project.  Phase 2A is slated to be completed in early 2015, with service running from Downtown Los Angeles to Azusa.  The project will create new Gold Line stations in Arcadia, Monrovia, Duarte, Irwindale, West Azusa and East Azusa.  Each city along the Gold Line intends to utilize these new stations to enhance residential, retail and mixed-use developments within walking distance of each station. 

The goal of these Transit Oriented Developments (TOD) is to increase the use of public transportation, decrease the effects of sprawl and create a more sustainable way of living.  TODs generally extend out a quarter to a half-mile from a transit station.  The existing development around many of the proposed stations lack density and will allow for the acquisition and entitlement of many parcels for a more dense uses. 

Why is this important?

The San Gabriel Valley is one of the strongest real estate sub-markets in all of California.  The area boasts several examples of successful projects built during the last few years that have exceeded sales expectations.  This includes Pulte Homes’s Rosecrest Lane project that averaged sales over $800,000 per home in Pasadena in 2010-2011. 

Recent land acquisitions, including a 5.4-acre industrial site in Monrovia that is now planned for mixed-use, show the propensity of buyers and developers for both traditional and transit-oriented areas of the San Gabriel Valley.  With densities expected to double in close proximity to a number of these stations, an estimated increase of 100 to 300 residential units will be needed to satisfy renter and buyer demand at each station. 

The Los Angeles Infill team is closely monitoring the Gold Line extension, and can answer any questions builders and investors may have in regards to preparing for the “gold rush.”  For more news and events related to the Gold Line, check out www.foothillextension.org.

Source: Chris Gomez-Ortigoza, Marketing Consultant, (626) 376-9840 x14