Despite Pandemic, LA County Real Estate Prices Rise for 11th Consecutive Year

The value of residential real estate goes “through the roof”.

The already expensive real estate market in LA is getting more and more expensive.
The Los Angeles District’s 2021 valuation list, which looks at all taxable assets in the district as of Jan. 1, grew by $ 62.9 billion to $ 1.76 trillion – the eleventh consecutive annual increase.

“We were all a little pleasantly surprised to find out that despite the pandemic, the rating list would grow during a pandemic-induced recession,” said Jeff Prang, assessor for LA County.

Real estate sales added $ 44.9 billion, while a Prop. 13 adjustment to the consumer price index added $ 16.4 billion and new homes added $ 8.8 billion.

The overall valuation of the role is $ 17 billion in property taxes. The money, Prang said, will be used for public education, first responders, public health and other services.

“It’s a positive forward move, which means local government and schools will have property tax revenue growth, which will ensure jobs and services and things people rely on during a pandemic,” Prang said.

Some rejections
However, not all measures have grown in the last period. There was a $ 5.5 billion decrease in private business ownership, a category that includes machines, boats, and planes.

“This is mainly because many restaurants that pay property taxes on their cooking appliances were exempt,” said Prang. “Since they were not used, they were granted an impairment.”

Prang said some types of assets, such as the hospitality industry, suffered while “residential property went through the roof”.

He said the estimated value of single-family homes has increased by an average of 22%.
UCLA Ziman Center director Stuart Gabriel said he had seen an increase in desire for homes, especially in suburbs.

“With the pandemic and the post-pandemic, there has been a remarkable change in what we call within metropolitan areas or inner-city location preferences,” he said. “A rough way of characterizing this is that the suburbs were not in favor before the pandemic and were favored after the pandemic.”

“We have seen a very significant upward movement in demand,” he added.
John Loper, an associate professor at USC’s Price School of Public Policy, said the trend is continuing among tenants as well.

“If you look at rents, suburban areas do much better in rental markets than urban areas,” he said.

Loper added that during the Covid-19 pandemic, more millennials chose to buy houses too.

Industrial profits
In addition to residential properties, industrial facilities also performed well, according to Prang.
“Another area that benefited was warehouses, industrial areas with many companies that switched to teleworking and postal operations. They needed storage space to handle the shipping, ”he said.

At the same time, the value of the refineries fell as fewer people drove.
Prang said things have been “relatively stable” so far this year in terms of home sales, but there is still some uncertainty on the commercial side, particularly with the new Delta variant of the coronavirus.

“We’ll need some time before we can predict what will happen next year,” said Prang. “Although things seem to be moving in a relatively optimistic direction at the moment, there is so much uncertainty and the housing market is overheating.”

However, he anticipates an increase in retail companies filing for depreciation.

Prang also proactively reviews properties such as hotels to see if they have depreciated in value and considers offering tax breaks if necessary.

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