We’ve purchased a three-bedroom, two-bathroom rental home in the Glassell 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 the completion of minor renovations, we intend to rent the property for approximately seven to ten years before selling the home. 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
- Desirable neighborhood: The New York Times recently featured Glassell Park as an up-and-coming neighborhood of Los Angeles, attracting prospective home buyers with its charming bungalows, hillside vistas, and numerous small eateries and restaurants.
- Fast-growing area: In the five year period ending July 2018, the Zillow home value index in the 90065 ZIP code has grown from $525,000 to $809,000, an increase of more than 54%. 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.
