An L.A. developer has a new approach to the tenancy-in-common model, in which residents share ownership of the property. khouriandrew reports:
A new housing model that landed in Los Angeles several years ago made home ownership more affordable in pricey neighborhoods, a welcome option in a housing-starved region.
region’s gaping affordable-housing problem, particularly after a new state law opened more areas to similar development. Southern California home prices hit a record high in December, the 10th record in 2021. Analysts see the housing market cooling slightly this year. Except for one single family house built as part of a three-unit TIC development in West Adams, B&A’s new townhome units are all three bedrooms with roughly 1,500 square feet and a rooftop deck or a small yard.
“I think it’s smart for when I get older,” Howard said, of owning an asset rather than spending money on rent. “I can have something that I own.”How the pandemic helped scatter $1-million homes across L.A. Some of the new rental units were pricey, high-end units, while others were cheap enough to qualify as Section 8 housing.
Cali said they bought all houses on the open market and make a point of asking the listing agents whether anyone would be displaced with the sale, something he said the agents said wouldn’t happen.According to county records and an interview with one previous owner, at least five of the seven houses B&A bought had been owner-occupied. One house had been rented before the sale, according to the tenant, who said the landlord let him move into another rental she owned for the same rental price.
The particular features of TICs — the shared ownership structure, for example, and the lack of fixed-rate financing options for them — also mean they aren’t swamped with buyer-interest the way most California homes are these days.Homes are flying off the market at a record pace thanks to a perfect storm: pandemic-induced demand for more space, low supply, and apps that make it easier to view, bid for and buy houses — all with a few swipes and clicks.
But if the model catches on, he said, he worries other developers will pressure low-income homeowners to sell en-masse, then build and sell homes for far more than B&A prices. A familiar cycle would then begin, he said, with high-earners moving in and driving home prices up further.Even the discounts B&A’s projects now offer are a concern for Steven Meeks, president of the neighborhood council for West Adams.
UCLA’s Monkkonen said it’s also important to consider what could’ve happened absent B&A’s purchase of the old houses: It’s common for investors to purchase old, rundown homes and renovate them to much higher values — something that doesn’t add any additional units and happens frequently in West Adams and across the city.Do you live among million-dollar homes? These 15 L.A.
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