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Zip Code 90038: Rising Home Values and Low Ownership in Los Angeles Rental Hub
CATEGORY
Property Value
DATA
Percent Owner Occupied
Housing Prices
Median Rent
Population
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Property Value
Percent Owner Occupied
Housing Prices
Median Rent
Population
Zip code 90038, located in Los Angeles, California, presents a unique urban landscape characterized by a predominantly renter-occupied housing market. This area has experienced significant fluctuations in average home prices and rent over the past decade, coupled with a consistently low homeownership rate.
The homeownership rate in zip code 90038 has remained relatively stable, hovering around 9% from 2013 to 2022. Despite this consistency, average home prices have shown a substantial upward trend. In 2013, the average home price was $650,970, which increased dramatically to $1,248,977 by 2022, representing a 92% increase over nine years. This stark contrast between stagnant homeownership rates and rising home prices suggests that property value appreciation has not translated into increased homeownership opportunities for local residents.
Federal interest rates have played a role in shaping homeownership trends, although their impact appears limited in this zip code. For instance, when interest rates were at historic lows of 0.08% in 2021, the homeownership rate remained at 9%. Even as interest rates rose to 1.68% in 2022, the ownership rate slightly decreased to 8%. This suggests that factors beyond interest rates, such as high property values and local economic conditions, may be more influential in determining homeownership rates in this area.
The rental market in zip code 90038 has dominated the housing landscape, with renter-occupancy consistently above 90% throughout the observed period. Average rent prices have shown a steady increase, rising from $1,046 in 2013 to $1,722 in 2022, a 65% increase. This trend aligns with the area's high renter population, which stood at 25,384 in 2022 (92% of 27,591 residents). The consistent rise in rent prices, coupled with high occupancy rates, indicates strong demand for rental properties in this zip code.
In 2023 and 2024, we observe a slight dip in average home prices, with values of $1,224,889 and $1,170,560 respectively. This represents a 6.3% decrease from 2022 to 2024. Concurrently, federal interest rates have risen significantly to 5.02% in 2023 and 5.33% in 2024, potentially contributing to the cooling of home prices.
Looking ahead, predictive models suggest that average home prices in zip code 90038 may continue to experience modest declines or stabilization over the next five years, influenced by higher interest rates and market corrections. Average rent prices, however, are projected to maintain an upward trajectory, albeit at a slower pace, driven by the area's persistently high demand for rental properties.
In summary, zip code 90038 is characterized by a robust rental market with steadily increasing average rent prices, contrasted with high but recently stabilizing average home prices. The area's low homeownership rate has remained resistant to change despite significant property value appreciation, suggesting deep-rooted structural factors influencing housing dynamics in this Los Angeles neighborhood.
