Property Trends to Watch this Spring in Playa Vista

The start to 2025 in Los Angeles was met with devastating wildfires, which displaced thousands of residents and disrupted many segments of the sale and rental market, postponing many non-immediate moves and prioritizing urgent ones for fire victims. An existential situation such as this, understandably, made some potential buyers and sellers re-evaluate their plans. However, at the time of this writing, as we approach March, activity has begun to normalize and it looks like we might have a slightly later spring “hot market” season than usual. With this timing in mind, here are some Playa Vista market trends that will impact supply and demand this year and beyond.

Four bedroom houses and three bedroom condos rule the market

In Playa Vista, detached houses that have only three bedrooms stay on the market longer, sell for a lower price per square foot, and are less likely to sell at all compared to those that have four or more bedrooms. In 2024, 3-bedroom homes that were listed on the MLS sold for an average of $968 per square foot, while 4-bedroom or larger homes sold for an average of $1,032/SF. Of the ones that were listed and did not sell during the initial listing period, only one of five 3-bedroom homes has since sold, while four out of five 4-bedroom or larger homes have sold after initially being de-listed. A typical family in Playa Vista has two children and also requires a work from home space and/or a guest bedroom, so to justify putting down roots in a house for nearly $3 million or higher in 90094, four bedrooms are most often desired. For attached condos, three bedrooms in the $2M and under price range do receive ample demand, and a significant price premium is seen between condos with three versus two bedrooms.

Functional floor plans are more important than total square footage

Price per square foot is considered one of the preferred metrics in determining a “good value”, and while this may be true with commercial space, in residential real estate there is always a reason for a low price per square foot. It generally means that there is some flaw or multiple flaws with the property (e.g. functional obsolescence, poor layout, lack of natural light, low ceilings, busy street), or just does not meet the needs in some way of a large portion of Playa Vista buyers. As shown by the 4-bedroom price per square foot premium example, too few bedrooms in exchange for spaces for which there is a lesser need can contribute to a lower price per square foot. An efficient layout such as open great room with kitchen, smaller secondary bedrooms, and a room to use as a home office very well could command a similar or higher price than a larger property with oversized bedrooms and multiple rooms for living that are not as useful. Additionally, high ceilings, which add no additional living area, give the feeling of airiness or dramatic views that buyers crave and that “wow” factor can strongly increase price per square foot.

Updated homes command a substantial price premium vs. outdated ones

There is not surprising to know that most buyers prefer to not have to tackle a large remodeling project when they buy a home. In fact, the marketability of a recently updated home is becoming more and more apparent when compared to one that is only 20 years old, but has not been updated (early Phase I Playa Vista homes). Given the price premium, it could pay off for a seller to tackle a remodeling project or at least make some ROI improvements before selling or, as a buyer, if you are looking to build sweat equity, go for more of a fixer. Expect this trend to become even more pronounced in the wake of the fires and changes in U.S. trade policy leading to increased construction costs and longer waits and higher prices for busy tradespeople.

New purchasers are skewing older and less foreign

With interest rates being high, cash buyers have become more prevalent than ones who are getting large loans. These buyers tend to be older, many of whom are downsizing, and have a lot of equity from their prior property or other sizable assets. This allows them to minimize mortgage debt, keeping monthly payments low, as well as to park their money in a less risky asset such as real estate rather than the more volatile stock market. This does not always mean the buyers themselves will be older. Many people in this demographic are contributing to their adult children’s purchase by either supplementing their down payment or offering private loans with favorable rates. Expect this to continue as interest rates remain elevated and affordability low. Additionally, with an extremely strong U.S. dollar, purchases denominated in foreign currency have become more expensive, reducing foreign demand. The percentage of purchases made by non-U.S. citizens, already down close to 80% since 2017, should continue to decrease, as new protectionist tariffs and immigration policies, either by choice or unintended consequence, limit real estate investment by foreigners.