It’s interesting to note how big cities are addressing their housing problems, but at this point in time there is no other situation like the Los Angeles area. The article below tells us about converting some of the unused office space to apartments. Meanwhile, as noted previously in this space, legislation took effect at the start of 2025 for California to allow ADUs (Additional Dwelling Unit) which includes Los Angeles County. These actions are each independent of the results of the recent wildfires which destroyed hundreds of houses and forced thousands of tenants to vacate and find other housing.
Other states such as Washington have recently enabled ADUs to encourage more housing becoming available in dense areas whether office space is being converted or not.
There are no assurances that having two different means of creating more housing in the Los Angeles area will bring an increase in rental tenants or help to combat rising costs. Additional competition for tenants and buyers might be a good thing, especially for potential tenants.
One consequence of all this is how real estate brokers, lenders, contractors, and investors need to be aware of how all of this is shaping up for the months and years to come. Anticipating opportunities is an important part of the strategy, whether for the job or possible results of a short-term or long-term investment.
Meanwhile, we have an increase in the number of people moving out of California. It’s to the point that California is now among the states “losing” the most residents, with housing prices being a big reason why. Creating more housing may be a solution, but it may not happen in time to keep thousands more current residents in place. Newly created housing, whether through new construction or conversion, may or may not be priced within reach for “new” residents or to keep displaced residents in California.
How this plays out in California, especially in the Los Angeles area, could impact other major cities both inside and outside of California over the next few years. All of this is still another reason to continue to research market trends along with pending legislation and local zoning changes. I’m constantly reminding my clients and trusted connections about making sure they know “more” than whoever they are negotiating against about possible advantages.
Having a research person or team on your side is even more important than it was a year ago. Let’s connect!
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