Around Town: Market prices out first-time buyers
The Foothill Assn. of Realtors has confirmed that first-time home buyers have been priced out of La Cañada Flintridge.
“With the current median home price in La Cañada at about $1.3 million to $1.5 million and the average home price coming in even higher, around $1.8 million, it’s a market most first-time home buyers and young families can’t afford to break into. Those who do often do so with help from parents, who contribute toward a substantial down payment or purchase the house for them.”
What does this mean for the future of La Cañada Flintridge?
When our family came to La Cañada, home prices were less than in certain areas of Pasadena and Glendale. La Cañada was the economic choice. Given the reputation of the schools, other young families moved here. Many of them had grown up in the community. They had extended family nearby
For the last few years, many of us have observed that first-time home buyers could not purchase homes in our town. We knew this because our children and their classmates could not buy homes here. An entire generation of young adults who had grown up in LCF felt lucky to buy a single-family residence in Montrose, Altadena or Pasadena.
In recent years, home values in LCF have gone up due to several factors: highly rated public schools, the ease of suburban lifestyle and low crime rates. Low interest rates have contributed to a seller’s market.
Have we reached a tipping point? If first-time home buyers cannot purchase homes in LCF, what will be the effect on our town?
Will this result in lower elementary school enrollment? Will the school district continue to bolster its census by accepting out-of-district students whose parents work at JPL or at La Cañada professional offices and businesses? Most likely, it will.
Anecdotally, LCF has benefited from second-time home buyers with middle and high school age children who come here for the schools. These families are willing to downsize in order to move into LCF. They do this for the schools and to avoid private school tuition.
Last year’s tuition and fees at Loyola High exceeded $19,000. LaSalle is in the same range. Harvard-Westlake’s current tuition is $35,900, with a new student fee of $2,000. At Brentwood School, parents pay $39,195 with a new student fee of $2,000.
For a family of four, with equity in their first home, there are clear benefits to putting $80,000 toward a mortgage, and moving into a smaller but more expensive LCF home. Not only are there tax deductions for interest payments and potential future equity as real estate values increase, but the family avoids a competitive private high school admissions process.
Rising real estate prices have another effect. Older La Cañadans who wish to downsize face economic challenges. If they sell their $1.5 million home in LCF to move into a $1 million condo in Pasadena, they will avoid some taxes, but their property taxes will double, triple or quadruple, depending upon how long they’ve lived in their La Cañada home. You do the math.
Given current trends, it appears to me LCF should continue to see a decline in local elementary school enrollment as first-time home buyers are priced out of the market, there will be stability in local high school enrollment as second-time home buyers move here to avoid private school tuition, and some graying of the community as more older La Cañadans decide to stay put.
On the other hand, if the 710 connection gets approved, and if interest rates go up, La Cañada will become less desirable. The revitalization of downtown Los Angeles, expansion of the Metro system and perks of multi-use urban development could pass us by.
You never know.
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ANITA SUSAN BRENNER is a longtime La Cañada Flintridge resident and an attorney with Law Offices of Torres and Brenner in Pasadena. Contact her at anitasusan.brenner@yahoo.com. Follow her on Instagram @realanitabrenner, Facebook and on Twitter @anitabrenner.