We’ve directly acquired a three bedroom, one and a half bathroom rental home in the Highland Park neighborhood just north of downtown Los Angeles. This acquisition is part of our broader strategy to acquire homes in cities with a chronic undersupply of housing.
Business plan
Following completion of minor renovations, we intend to rent the property for approximately 7-10 years before selling. The goal is to earn consistent cash flow from rent payments, while capturing what we believe will be continued strong appreciation in home values in LA’s emerging neighborhoods.
Why we invested
- Great location: Highland Park is conveniently located between downtown LA and Pasadena, offering easy access to both.
- Fast-growing neighborhood: Over the five-year period ending August 2018, the Zillow home value index in the 90042 ZIP code has increased from $460,000 to $754,000, an increase of more than 63%. We believe this trend will continue as prospective homebuyers are priced out of more established neighborhoods.
- City-wide housing shortage: LA home prices have grown much faster than incomes in recent years, resulting in a major affordability crisis within the city. With large sections of the city simply out of reach for many renters and homebuyers, we believe that smart investments in up-and-coming areas will deliver attractive long-term returns. See our LA market analysis.
