There are plenty of reasons to get into real estate and even more opportunities to get started. But where should you begin?
Let’s look at one of the country’s most lucrative real estate markets: the Los Angeles neighborhood of Bel-Air.
Why Should You Invest in Bel Air?
In all likelihood, you’ve heard the name Bel Air before. It’s one of the most sought-after neighborhoods in Los Angeles and the entire country, and perhaps its already in your saved searches. Its name is strongly associated with the richest and most famous residents of the Los Angeles area, and rivaled in the U.S. perhaps only by Beverly Hills and New York.
Successful people flock to Bel Air for a variety of reasons. A closer examination of Bel Air’s features reveals why it’s so alluring to the rich and powerful—after four decades of investing in Westside real estate, we’ve got a good read on Bel Air real estate.
Where is Bel Air?
Bel Air boasts one of the ideal locations in Los Angeles.
On your map, Bel Air Rd is located in the Westside region of Los Angeles, one of the country’s most competitive real estate markets.
It’s less than 10 miles away from downtown L.A. and the Sunset Strip. It’s less than 15 miles away from the sandy shorelines of the pacific ocean. Surrounding neighborhoods include Brentwood, Westwood, Holmby Hills, the Pacific Palisades, and Laurel Canyon.
Sitting in the shadow of the Santa Monica mountains, this residential neighborhood is in a prime location in the city.
Bel Air Has An Unbeatable Location
Bel Air’s relative proximity to the most attractive features of Los Angeles makes it one of the strongest neighborhoods in all of L.A. county. Residents can enjoy spacious, suburban living with all the draws of urban life just around the corner.
Bel Air has it all.
What Are The Population Demographics of Bel-Air?
Bel Air is a relatively small neighborhood regarding population—it’s home to about 8,500 residents.
With a median age of 44 years old, it’s mansions and townhomes house an established community.
Most workers in the Bel Air area have white-collar jobs, well over 90%. These workers bring in significantly higher incomes than even the most affluent Los Angeles neighborhoods. The median household income of Bel-Air residents is about 175,000, while the average household income is well over 350,000.
Most people in Bel Air have received higher education. 35% have a four-year bachelor’s degree, and another 38% have a graduate degree, making it one of the most educated neighborhoods in the city.
Bel Air is in the Los Angeles Unified School District.
Bel Air Is Home To Affluent, Well-Educated, and Well-Established Residents
The income levels, educational level, and most common age bracket of Bel-Air indicate that most of its residents are well-established individuals.
With so much capital and brain power in the neighborhood, commodities and investment assets like real estate operate at a very high standard. Property in Bel Air, from single-family homes to townhouses to mansions, is highly valuable.
What Are The Housing Statistics of Bel-Air?
As a residential neighborhood, the majority of square footage in the area tends to be residential households.
The total number of households in the neighborhood is around 3,300. About two-thirds of these households are family establishments, and the other third are non-family units.
The rate of development for more households has declined. The most recent stats indicate that the supply of residential households in Bel Air decreased by 4% over the course of the year. With fewer units available, the units available become more competitive.
About three-quarters of the units currently occupied in Bel Air are owned. A fourth is leased to renters.
Housing Supply Is Low, Which Leads to High Demand
Decreasing the availability of units of housing in Bel Air could increase the competitiveness of what properties remain. With a select pool of renters in the area, the demand for these leased properties allows investors the opportunity to secure a reliable, high yield of rental income.
What Makes Bel Air Such A Great Investment?
To better understand why Bel Air is such a great investment opportunity, it’s important to understand what makes a good real estate investment in the first place.
Let’s unpack the characteristics that make real estate such a unique asset class and see how they inform the high value of Bel Air real estate. In every Bel Air property, we can see these four characteristics at work, driving their value.
- Scarcity
- Improvements
- Permanence of Investment
- Location
Scarcity
Real estate is necessarily a scarce asset. We can’t make more land, so as an area becomes increasingly developed, the glass ceiling lowers the total number of property units that can be built up in the future.
Furthermore, development takes a lot of time and can cost a lot of money. The process of zoning vacant lot size, constructing a building to code, and finally putting it on the market is a long, difficult process.
The sluggishness of new construction sustains a low supply of property. With the number of homes for sale low, demand rarely ever dips below it. That means the value of property generally tends to rise over time.
How Scarcity Helps Bel Air Real Estate
Scarcity helps create a more valuable property in Bel Air.
New construction is slow in Bel Air, as seen by the decreasing supply of units in the neighborhood. This dwindling supply makes housing units more scarce, further driving up available units’ price/sqft.
Improvements
Real estate is unique in that investors have the opportunity to increase the value of their assets through improvements to the property.
Other asset classes, like stocks and bonds, don’t allow investors to affect their value—they’re acquired if their performance determines their value.
Because investors have more of an impact on the value of their assets in real estate, they have more control of their return. Improving the property results in improving the property value, which helps bring more cash for the square feet available.
Increase The Value of Bel Air Real Estate With Improvements
Bel Air real estate is already an extremely high-value market. The median listing price for a Bel Air property was 6.3 million dollars as of May 2022.
Further additions to this hyper-prime real estate will allow investors the chance to guarantee they get a better return for a sale later down the line.
From complete renovations to minor improvements on the home, Bel Air homes can explode in value with every alteration made to the property.
Permanence of Investment
Investments made into a real property like real estate can become permanent fixtures to the asset.
For example, repairing a home’s roof imbues the property’s value with capital. Intensive improvements like these aren’t just difficult to undo; it doesn’t make sense to undo them in the first place.
This means that investments made into a property become fixed, securing the capital to the asset and increasing its value permanently.
Bel Air Real Estate Gives Investors A High Value, Permanent Investment Opportunity
The fixity in investments made to high value means that capital is safe and secure in the asset.
Location
Location is a huge factor in the value of a real estate asset. A complete grasp of a real estate’s location gives investors key insights into the value potential of a real estate asset.
Two properties can be virtually identical, but that doesn’t mean their value is the same. Location can make monumental differences in the value of a real estate asset.
Bel Air Is A Prime Location For Property
The high property value of Bel-Air speaks for itself—Bel Air is one of the most sought-after neighborhoods in California.
With property values rising, Bel Air’s desirability as a location isn’t changing any time soon. It’s as good a time as any to invest in Bel Air property. Want to learn more about real estate fundamentals? Check out our educational modules.
What Trends Make Bel Air A Hot Market?
- High rental demand
- Population growth rate
The increasing property value of homes in Bel Air is a clear indicator of a strong real estate market.
But what are the trends that contribute to this ideal time to invest?
By learning to identify the trends that characterize a strong real estate market, you’re better equipped to make smarter investments.
Here are the trends you should look out for in the future for Bel Air real estate and elsewhere.
High Rental Demand
Most real estate investments earn their income through rental properties—a consistent rental income can be a great way to earn passive income.
Since rental income is a key component of real estate investing, identifying the demand for rental properties provides investors with crucial information about a given area.
How Can You Determine Rental Demand?
With a little research, investors can get a good sense of the demand for rental properties.
Check new listings for rental apartments. How long are they on the market? If they go quickly, that’s strong indication properties are high in demand.
Another way to get a sense of the demand for rental properties is by identifying the supply of rental properties in the area. Supply can have a huge effect on demand. In Bel Air, for example, there is a relatively small supply of rental properties available on the market.
This selective supply means that the 25% of renters residing in Bel Air are in a more competitive market. With fewer properties to choose from, the demand for available units increases—a strong indication it is an opportunity to buy into a rental property.
Population Growth Rate
Trends in population play a key role in the direction real estate markets are headed.
With more people moving to an area, the need for more housing units increases. Property values rise. Investing ahead of this curve can net investors a solid return.
Alternatively, a shrinking population could make a less competitive market. But this isn’t a bad thing. It allows investors to buy real estate assets at a better price.
What Is the Population Growth Rate In Bel Air?
Recent analyses point to a fractional decrease in the Bel Air population.
Bel Air’s population is relatively small compared to other residential neighborhoods in Los Angeles. Its residents are generally well-established in the community. The population level is generally static, making this neighborhood one of the most stable in the country.
Stability is baked into the population of this exclusive neighborhood, setting a robust baseline that investors can count on.
Want To Know More? Contact Us
We know Bel Air, Hollywood Hills, Santa Monica, Beverly Hills, and more like the back of our hand. The real estate professionals at Christina have honed a strategy that has made us one of Southern California’s most successful agencies.
Are you considering a real estate investment in this exclusive market?
We’re your developer, manager, and sponsor. Get started with Christina today.
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