West Hollywood's property values dropped 3 percent in the last year, according to the Los Angeles County Assessor's 2010 annual report. It was the first decline the city has seen in five years.
The median home value in West Hollywood in January 2010 was $630,000, according to Robert Kleinhenz, deputy chief economist of the California Association of Realtors. Kleinhenz said financing was an issue for many because homes priced at $600,000 or higher wind up falling into a jumbo loan category.
"If you want to buy a home that's a $800,000 or $900,000 loan, you'll pay not only high mortgage rate because of the jumbo loan, chances are you'll be making very large down payments," he said.
"You're also seeing a lot of high-end properties being foreclosed on, so the high end of the market is feeling a lot of stress that the low end was feeling a year ago," Kleinhenz said.
Down payments for homes in high-end housing markets such as West Hollywood can be as high as 50 percent, which has cooled activity in those communities, he said.
"In the five previous years we had an increase of 45 percent or 50 percent. So when you look at [a 3 percent decrease] just for one year, that's just the economy," said Anil Gandhy, the city of West Hollywood's director of finance. "We're pretty much in line with neighboring cities, like Beverly Hills. You need to look at this through a broader window, not just through the economic conditions of the last year…I think the property value has stabilized, if anything," he said.
The value of West Hollywood's 9,500 residential parcels diminished more than those in neighboring cities that also saw decreases, such as Beverly Hills (down 2.6 percent) and Culver City (down 1.7 percent). Glendale (up 1.3 percent) and Malibu (up 1.2 percent) were two of the only nearby cities to see upticks.
The 2010 Annual report looks at 2.3 million residential and commercial properties in Los Angeles County's 88 cities and unincorporated areas. To view or learn more about the 2010 Accessor's Annual Report, click here.
- Beverly Hills (- 2.6 percent)
- Culver City (- 1.7 percent)
- Santa Monica (- 0.9 percent)
- West Hollywood (- 3.0 percent)
- Glendale (+ 1.3 percent)
- Malibu (+ 1.2 percent)