Los Angeles Housing Market: Why It’s One of the Least Affordable in the U.S.
Los Angeles is a city many people dream of living in. It has great weather, beaches, and exciting job opportunities. But when it comes to buying a home, the reality is tough. According to Zillow economist Kara Ng, “No matter how you slice it, Los Angeles is one of the least affordable housing markets in the country.” And sadly, the data proves her right.
Middle-Class Buyers Are Getting Pushed Out
In October 2024, only 1.6% of middle-income families in the Los Angeles metro area could afford to buy a home. That number has been going down each year. Just three years ago, it was 9.9%. Today, even people with good jobs struggle to buy a small, basic home.
Some buyers say that even making $100,000 a year doesn’t help. High prices, interest rates, and the cost of living make owning a home feel impossible—unless you have help from family or already own property.
Who Can Afford to Buy in Los Angeles?
What’s Making L.A. Housing So Expensive?
Several reasons explain why homes in Los Angeles are so pricey and out of reach for many.
1. Lower Wages Compared to Home Prices
While cities like San Francisco also have high home prices, workers there usually earn more. In Los Angeles, incomes are lower, which makes housing less affordable overall. People are earning less but still facing high costs.
2. Too Few Homes on the Market
There aren’t enough homes available. Years of slow building, strict zoning laws, and local resistance to new housing have all added to the shortage. Less supply means higher prices.
3. Corporate and Investor Buying
Large companies and wealthy investors often buy up homes, especially starter homes. This reduces the number of homes available to regular buyers. Many locals feel like they’re competing against people with way more money.
4. High Monthly Costs
Even if you save up for a down payment, monthly mortgage payments can still be huge. For many families, payments of $6,000 to $8,000 a month are simply not realistic. Add in taxes, insurance, and home repairs, and the total cost is overwhelming.
Is Renting a Better Option?
Because buying is so expensive, many residents choose to rent. Some say it’s more flexible and less stressful. You don’t have to worry about repairs, taxes, or unexpected costs. Plus, some renters prefer to invest their money elsewhere, like in stocks or savings.
One resident shared, “Owning a home cost me $40,000 in repairs over five years. Renting gave me peace of mind.”
L.A. Housing Affordability Over the Years
What Needs to Change?
People in Los Angeles have a lot of ideas on how to fix the housing problem. Here are some solutions being discussed:
Reform Prop 13 to only benefit people living in their homes—not investors.
Raise taxes on second homes and corporate-owned properties.
Build more housing of all types, not just luxury or low-income units.
Make it easier to build by changing zoning rules and speeding up permits.
Improve public transportation, so people can live farther from downtown and still commute easily.
Everyone agrees something must change, but there’s a lot of debate on the best path forward.
Final Thoughts: A Dream Out of Reach?
The cost of housing in Los Angeles keeps going up. While the city still attracts new people, living here comes with a heavy price. For the middle class, buying a home is becoming more and more like chasing a dream they can’t catch.
Unless there are big changes, owning a home in Los Angeles may remain possible only for the wealthy—or those with help from family. For now, many residents are left renting, saving, and waiting for the market to shift.
