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Brock's newsletter  |  March 28, 2025
 
What's The Next Hot Area? 🌶️
 
Sometimes, neighborhoods get too fancy. My hometown Silver Lake might currently be the best example of my favorite gentrification maxim: Charm attracts money…which destroys charm.
 
Some streets, meanwhile, seem evergreen. Larchmont was great in the 90s and is great now. Lori used to walk to Sam’s Bagels from her friends’ houses in high school, and it’s still there (now our kids’ favorite L.A. bagel).
 
On the other hand, some areas are in full decline.

LA residents of a certain age will remember Westwood in the 1980s—it was a scene. But there was a shooting in 1988, and the neighborhood never recovered. I was there recently to see a show at the Geffen and couldn’t believe all the vacancies. Still, contrary to popular belief, landlords don’t get a “tax deduction” for a vacant storefront. That area is suffering.
Are there secrets to spotting the next hot area? I once read that the number one predictor of gentrification is the age of the housing stock—hipsters like fixing up old houses.
 
Styles also come in and out of fashion. Craftsman, mid-century, and Spanish homes all have their day as buyer favorites. Are ‘80s homes next? If so, here comes the San Fernando Valley.
 
I think the more important question is which areas are overvalued and which are undervalued. There are neighborhoods where buyers are overpaying and there are neighborhoods slipping under the radar. I won’t say which are overvalued, but I am seeing value right now in the following areas:
  1. The middle canyons - Laurel Canyon, Nichols Canyon, Lake Hollywood, and Hollywood Heights. We speak to buyers all the time who want to buy in Silver Lake, Los Feliz, or the Westside, but pass on these middle areas. I’m telling you, there’s big opportunity here.
  2. On the Eastside, I’m a big fan of Cypress Park, Glassell Park, Montecito Heights, and GLENDALE. If you’re priced out of Los Feliz, Glendale is it. Take a drive through Adams Hill, Kenneth Village, and Verdugo Woodlands if you’re not familiar with the area.
  3. High Fire Zones. People are flocking away from the hills due to the recent fires (yes, Hancock Park values are going up!), but our memories are short, and it may be a good time to buy in some of LA’s most charming neighborhoods (Altadena, Sierra Madre, La Canada, Pasadena, etc.).
This is a good time to mention (again) that buying low is overrated in real estate anyway. If you hold for any significant amount of time, it doesn’t matter what you paid—any perception that you are “overpaying” at the time will feel like a rounding error in 20 years.
 
What you pay is less important than what you buy.
 
But the appeal of getting in early on an emerging neighborhood is the excitement of being a part of it growing and getting busier and vibier. At least, that’s what I like. Watching Northeast LA grow and evolve around real estate I own over the last twenty years has been fun.
 
I'm curious about what the next 20 years will bring.
Until next week,

 

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3020 Sunset Boulevard
Los Angeles, CA 90026, United States