Real estate is booming in California year-over-year. If you’re keen to invest in the Irvine real estate market in 2020 and buy before prices become out of reach, you must read till the end. Irvine, California is overshadowed by Los Angeles located forty miles to the northwest.
It is, however, a suburb of that rapidly expanding housing market and a niche housing market in its own right. Let’s learn more about Irvine before sharing 10 reasons to invest in the Irvine real estate. Irvine, California is a one hour drive from Los Angeles if the highways aren’t snarled with cars.
The Irvine housing market is certainly part of the L.A. metro area, though many residents tend to work in Orange County. The city of Irvine is home to around three hundred thousand people. We won’t say that cities like Anaheim are suburbs of Irvine, since they’re as large (or larger) than Irvine itself.
These LA suburbs have seen significant growth as people move out of the overpriced and often dangerous LA area while trying to maintain quality of life and proximity to high paying jobs. Is Irvine still one of the hottest real estate markets for investors in 2020? Let’s take a deep look at the latest Irvine housing market trends to come to a conclusion.
Irvine Real Estate Market Forecast 2020
The real estate data from Zillow shows that the median home value in Irvine is $851,100. Irvine home values have declined -1.9% over the past year and their Irvine real estate market prediction is that the prices will fall -1.5% within the next year. The median list price per square foot in Irvine is $489, which is higher than the Los Angeles-Long Beach-Anaheim Metro average of $439.
The median price of homes currently listed in Irvine is $978,400 while the median price of homes that sold is $828,300. The median rent price in Irvine is $3,500, which is higher than the Los Angeles-Long Beach-Anaheim Metro median of $3,200.
Here is the Irvine, CA real estate price appreciation graph by Zillow. It shows us the current home price appreciation forecast of -1.5% till Aug 2020.
Irvine Real Estate Market Trends
We will discuss some of the most recent housing trends in the Irvine area. Irvine has become a melting pot for Southern California community. The Irvine real estate market has always done very well because of it’s easy excess to all major freeways and highways with lots of option for public transportation.
Currently, Trulia has 1,120 resale and new homes for sale in Irvine, CA, including open houses, and homes in the pre-foreclosure, auction, or bank-owned stages of the foreclosure process. The median sale price in Irvine, CA is $846,000. Homes are selling for about $483/sqft.
In the past month, 205 homes have been sold in Irvine, CA on Redfin.com. In addition to houses in Irvine, there were also 532 condos, 100 townhouses, and 1 multi-family unit for sale in Irvine last month. As per their real estate data, The Irvine housing market is somewhat competitive. Homes in Irvine receive 2 offers on average and sell in around 61 days.
The average sale price of a home in Irvine was $826K last month, down 2.1% since last year. The average sale price per square foot in Irvine is $480, down 1.1% since last year. Homes typically receive 2 offers.
Properties for sale in the Irvine housing market sell for about 2% below list price and go pending in around 61 days. If it is a hot home, it can sell for around list price and go pending in around 34 days.
Irvine Real Estate Trends in Sep 2019: Source Redfin.com
|Median List Price||$940K|
|Avg. Sale / List||97.80%|
|Median List $/Sq Ft||$484|
|Avg. Number of Offers||3|
|Median Sale Price||$826K|
|Avg. Down Payment||28.20%|
|Median Sale $/Sq Ft||$480|
|Number of Homes Sold||205|
There are 1,376 homes for sale in Irvine, CA on Realtor.com. The Irvine home prices range from $169.5K to $19.8M. 95 of which were newly listed within the last week. Additionally, there are 752 Irvine rentals for sale. Their rent price ranges from $125 to $27K per month.
According to their statistics, in August 2019, the Irvine housing market was a balanced market, which means there was a healthy balance of buyers and sellers in the market.
Ideally a buyer would prefer a sale to asking price ratio that’s closer to 90%. In Irvine sellers have held good leverage in these negotiations. On an average, they could sold homes for 98.21% of the asking price in the past two years. A seller would always prefer scenarios which can yield a ratio of 100% or higher.
In August 2019, the median list price of homes in Irvine, CA was $935.6K, trending up 1.9% year-over-year. The median listing price per square foot was $486. The median sale price was $875K. On average, homes in Irvine, CA sell after 74 days on the market. The trend for median days on market in Irvine, CA has gone up since last month, and slightly up since last year.
The median home price in Irvine, CA is $1,420,888 on Coldwellbanker.com. Currently, there are 1,702 homes listed in Irvine which include 683 condos, 3 foreclosures.
The median list price in Irvine, CA is $1,000,000 on Movoto.com. The median list price in Irvine went down 2% from September to October. Irvine’s home resale inventories is 833, which decreased 2 percent since September 2019. The median list price per square foot in Irvine is $484. September 2019 was $485. Distressed properties such as foreclosures and short sales remained the same as a percentage of the total market in October.
Irvine, CA Single Family And Multi-Family Homes Statistics
Following the real estate market decline in 2007 in the U.S., single family rental homes became favorable options for investors, saving in construction or refurbishment prices. The quick turnaround for an owner to rent out their property means cash flow is almost immediate.
Single family rental properties have grown up to 30% within the last three years. Almost all the housing demand in the US in recent years has been filled by single family rental units.
U.S. single-family rental market has seen steady rent increases between 2010 and 2019. According to CoreLogic’s latest Single-Family Rent Index (SFRI), which analyzes single-family rent price changes nationally and among 20 metropolitan areas, it shows a national rent increase of 3% in April 2019, as compared to 2.8% in April 2018.
As per the real estate company called Neigborhoodscout.com, the median house price in Irvine, CA is $915,936, which indicates that home prices in Irvine are well above the national average for all cities and towns in the United States.
Large apartment complexes or high rise apartments are the single most common housing type in Irvine, accounting for 38.22% of the city’s housing units.
Other types of housing that are prevalent in Irvine include single-family detached homes, row houses, a few duplexes and homes converted to apartments. Irvine has a mixture of owner-occupied and renter-occupied housing.
Currently, there are 651 single family homes for sale in Irvine, CA on Zillow. Additionally, there are 312 single family homes for rent in Irvine, CA. Under potential listings, there are about 1 Foreclosed and 53 Pre-Foreclosure homes. These are the properties that may be coming to the market soon but are not yet found on a multiple listing service (MLS).
Irvine, CA Foreclosures And Bank Owned Homes Statistics
As per the Irvine foreclosure data by Zillow, in Irvine 0.2 homes are foreclosed (per 10,000). This is lower than the Los Angeles-Long Beach-Anaheim Metro value of 0.4 and also lower than the national value of 1.2. The percent of delinquent mortgages in Irvine is 0.4%, which is lower than the national value of 1.1%.
With U.S. home values having fallen by more than 20% nationally from their peak in 2007 until their trough in late 2011, many homeowners are now underwater on their mortgages, meaning they owe more than their home is worth.
The percent of Irvine homeowners underwater on their mortgage is 3.7%, which is lower than Los Angeles-Long Beach-Anaheim Metro at 4.1%.
|Foreclosures in Irvine||82|
|Homes for Sale in Irvine||591 (RealtyTrac)|
|Median List Price||$880,000 (0% ⇑ vs Jul 2018)|
There are currently 82 properties in Irvine, CA that are in some stage of foreclosure (default, auction or bank owned) while the number of homes listed for sale on RealtyTrac is 591. In August 2019, the number of properties that received a foreclosure filing in Irvine, CA was 6% higher than the previous month and 19% lower than the same time last year.
Best Neighborhoods to Invest in Irvine Rental Real Estate
If you are looking to invest in the Irvine rentals, you should know the best places to invest in. The three most important factors when buying a real estate anywhere are location, location, and location. Location creates desirability.
Desirability brings demand. Demand would raise the price of your Irvine rental real estate and you should be able flip it for a lump sum profit. When looking to invest in Irvine real estate, you need to find places where the expected property appreciation forecast is positive.
The running costs for owning and managing an Irvine rental property should be low. The neighborhoods in Irvine must be safe to live in and should have a low crime rate.
The neighborhoods should be close to basic amenities, public services and shopping malls. There should be a natural and upcoming high demand for rental properties and a low supply of income properties.
There are 16 elementary schools, 16 middle schools, 11 high schools and 30 private & charter schools. Irvine has above average schools in Irvine. There are 21 neighborhoods in Irvine.
Some of the best neighborhoods in or around Irvine, California are Northwood, Woodbridge, Westpark, Tustin, Tustin Legacy, Woodbury, Laguna Altura, Cypress Village, Turtle Rock, Pavilion Park, and Stonegate.
Shady Canyon has a median listing price of $7.2M, making it the most expensive neighborhood. Oak Creek is the most affordable neighborhood in Irvine, with a median listing price of $589.5K.
Here are the best neighborhoods to invest in Irvine rental real estate because they have the highest appreciation rates (List by Neigborhoodscout.com).
|1||Irvine Blvd / Trabuco Rd|
|2||Sierra Siena Rd / Sierra Perla Rd|
|3||Jeffrey Rd / Alton Pky|
|4||Michelson Dr / University Dr|
|5||Alton Pky / Briarglen|
|6||Walnut Ave / Culver Dr|
|7||San Marino / Alton Pky|
|8||Verano Pl / Campus Dr|
|10||Irvine Center Dr / Culver Dr|
Is Irvine a Good Place to Invest in Real Estate?
Now that you know where Irvine is, you probably want to know why we’re recommending it to real estate investors. Investing in real estate is touted as a great way to become wealthy. Should you invest in Irvine rental real estate?
Many real estate investors have asked themselves if buying a rental property in Irvine is good investment? You need to drill deeper into local trends if you want to know what the market holds for the year ahead.
We have already discussed the Irvine housing market 2019 forecast for answers on why to put resources into this market. Although, this article alone is not a comprehensive source to make a final investment decision for Irvine but we have collected ten evidence based positive things for those who are keen to invest in the Irvine rental properties.
Investing in Irvine rental properties will fetch you good returns in the long term as the home prices in Irvine have been trending up year-over-year. Let’s take a look at the number of positive things going on in the Irvine real estate market which can help investors who are keen to buy an investment property in this city.
We’ll focus on real reasons to invest in the Irvine real estate instead of giving you vague appeals to buy a house or an investment property because of general ambiance and mere promises of future growth.
1. The Job Market
Orange County is southern California’s tightest job market. Unemployment is less than 3 percent, and many of them are good-paying professional jobs. That’s one reason why many choose to live in Irvine.
Given the horrors of regional traffic, anyone working at UC Irvine, Verizon, Irvine Company or Broadcom typically chooses to live here so they aren’t commuting three hours a day to these good paying jobs.
2. The Sweet Spot between Quality of Life and Rental Rates
It is easy to find a cheap apartment in a place no one wants to live, though the reasons why demand is low could range from abundant gunfire at night to a lack of jobs and people in the area.
The Irvine housing market sits at a sweet spot. The City of Irvine consists of 8 zip codes and is often designated as one of the safest cities to live in. It has reasonable rental rates compared to expensive California coastal real estate prices, and it has a high quality of life rating.
This isn’t a matter of opinion. It was determined by WalletHub. That’s why the Irvine real estate market came in eleventh on the Wallethub ratings, the best city in California according to their metrics.
3. The Relative Deal for Renters
Sometimes a housing market can only be gauged by the competition. For example, the 2,500 monthly rental rate in the Irvine housing market sounds insane to those used to 1000 a month rents in the heartland.
Yet this is only a few hundred dollars more a month than a renter would pay in neighboring Anaheim. The more accurate comparison is the Irvine real estate market relative to Newport Beach directly to the west.
Renting in Irvine is several hundred dollars cheaper a month than Newport Beach and other towns sitting on the Pacific shore, yet you’re just as close to major employers.
4. How Oppressive Regulation Limits Housing Development
Regulatory restrictions on top of environmental regulations make it incredibly difficult to develop open land. It also drives up the cost of redevelopment, such as when you tear down a small home on a large lot to build anything from a modern 2600 square foot home to a duplex.
This slows down construction and redevelopment in the Irvine housing market and limits supply overall. That’s aside from local and state regulations that drive up the cost of labor and materials.
Conversely, it ensures significant appreciation of any Irvine real estate investment property. And that’s despite the average home costing around 850K.
5. How Local Regulations Limit Used Homes for Sale
Rent control hurts renters entering a market, because those in the rent controlled market have a major incentive not to move. This results in older singles and couples staying in the apartment in which they raised their children. The same thing is found in California due to Proposition 13.
Many retirees and childless middle-aged couples can’t afford to move until they can no longer stay in their home, since they’d pay higher property taxes on a smaller condo or two bedroom home than they pay in their grandfathered four bedroom suburban house. That drives up both rental rates and property prices in the Irvine real estate market.
6. Why Regulatory Efforts Make This a Great Time to Buy
Proposition 10 prevented rent control from being imposed on single family homes and apartments built after 1995. The vote to repeal Prop 10 was one of the most expensive legislative battles in California history, but the statewide rent cap went into effect in September, 2019.
Now rental rate increases will be capped. You may find deals on Irvine real estate investment properties by those who just want to get out before their hands are tied or their profit margins eroded.
This parallels the potential opportunities created by Oregon’s statewide rent control law. People afraid they’ll lose money become eager to sell.
7. The Cooling Irvine Housing Market
The Irvine real estate market hasn’t declined in value. However, property valuations are expected to rise one and two percent in 2020.
This means that some properties are having their prices cut as people try to sell and demand levels off for the foreseeable future due to flattening demand.
Rental rates in the Irvine area are expected to go up 4 percent in 2020 because so many do want to live here but can’t afford to buy unless property prices drop significantly.
8. The Relatively Friendly Environment for Landlords
California is tenant-friendly. However, local jurisdictions range from outright hostile to property owners to lukewarm. We’ll say that the Irving real estate market is one of the least hostile to property owners. For example, Orange County had fewer restrictions on why you could evict a tenant.
They had the 30/60 day notice to quit rules or the minimum the state required at the time. There was less risk of squatters ruining an Irvine real estate investment property and being protected by the courts than you would with a Los Angeles real estate property.
9. The Impact of Geography
While real estate’s mantra can be summarized as “location”, the Irvine real estate market is defined by it. Home prices in the Irvine housing market are certain to go up because the city is entirely built out.
And they can’t build up into the regional and state parks directly east of the city. Nor can they spread west, since cities like Corona Del Mar and the Crystal Cove State Park hem it in on the western edge.
Everything to the north and south is built out. That means that the only way one could increase housing stock is to tear down existing stock and build taller, denser or both. Conversely, people are willing to pay a premium to live in the Irvine area given the wealth of dedicated greenspace.
10. The Large Student Market For Investors
Student markets always present an excellent opportunity for real estate investors. The student market is almost immune to inflation. The value of the property is almost directly proportional to proximity to campus.
And in the case of the Irvine real estate market, potential student renters are competing with locals for limited rental spots. The robust rental market gives a Irvine real estate investment property extra value, since the demand for the rental isn’t tied directly to the rise and fall of one particular school.
Conversely, UC Irvine is home to around 30,000 students. That means the demand for a Irvine real estate investment property near campus won’t fall 10 percent because they built a new dorm or two.
Investing in Irvine Real Estate: The Conclusion
Maybe you have done a bit of real estate investing in Irvine, CA but want to take things further and make it into more than a hobby on the side. It’s only wise to think about how you can and should be investing your money. In any property investment, cash flow is gold.
A good cash flow means the investment is, needless to say, profitable. A bad cash flow, on the other hand, means you won’t have money on hand to repay your debt.
Therefore, finding a good Irvine real estate investment opportunity would be a key to your success. If you invest wisely in Irvine rental real estate, you could secure your future. If you are a beginner in the business of cash flow real estate investing, it very important to read good books on real estate.
The less expensive the Irvine rental properties are, the lower your ongoing expenses will be. Roughly a $150,000 property is what some experts recommend starting with. However, it is not easy to get that kind of a deal in Irvine as it is among the most expensive real estate markets in the U.S.
Most investors naturally gravitate to residential property investment. When looking for the best real estate investments in Irvine you should focus on neighborhoods with relatively high population density and employment growth.
Both of them translate into high demand for housing. If housing supply meets housing demand, real estate investors should not miss the opportunity since entry prices of homes remain affordable.
You must also collaborate and learn from savvy real estate investors who have retired early on in their lives by investing in some of the best real estate markets like Irvine, CA. Irvine’s housing market seems expensive, but that is in line with local real estate trends. The area remains stable and strong, though recent legislative trends along with ongoing regulations make this a great time to buy.
Buying or selling real estate, for a majority of investors, is one of the most important decisions they will make. Choosing a real estate professional/counselor continues to be a vital part of this process.
They are well-informed about critical factors that affect your specific market area, such as changes in market conditions, market forecasts, consumer attitudes, best locations, timing and interest rates.
NORADA REAL ESTATE INVESTMENTS strives to set the standard for our industry and inspire others by raising the bar on providing exceptional real estate investment opportunities in the U.S. growth markets. We can help you succeed by minimizing risk and maximizing profitability.
The aim of this article was to educate investors who are keen to invest in Irvine real estate in 2020. Purchasing an investment property requires a lot of studies, planning, and budgeting. Not all deals are solid investments. We always recommend to do your own research and take help of a real estate investment counselor.
Other Best Places To Invest in Real Estate in 2020
The other best place to invest in real estate is Boulder, CO. The Boulder metro area is becoming a high tech hub, driving up rental rates and property values.
Others are lured here by the promise of high paying jobs or attending school somewhere they can intern at Big Tech firms without paying a fortune. Boulder’s economy is stabilized by the presence of government research institutes and the proximity to Denver’s buzzing economy.
The median rent in the Boulder real estate market is $2500 per month. Even in the older downtown area, rents hover around 2300 dollars a month, and that figure is predominantly one and two bedroom apartments. Rents are inflated by the massive number of students in the Boulder real estate market.
Another upcoming market to choose for real estate investment is Vancouver, WA. Vancouver, Washington is a steadily growing, appreciating real estate market. Investors here will profit from Portland’s mistakes while earning greater returns than if they invested in one of the more expensive housing markets in the region.
The Vancouver WA housing market has a sizable student market. Better yet, it isn’t limited to a single school. Washington State University Vancouver has more than three thousand students.
It is the second largest Washington State campus. Gateway Seminary is home to around two thousand graduate students.
Let us know which real estate markets you consider best for real estate investing! If you need an expert investment advise, you may fill up the form given here.
One of our investment specialists will get in touch with you to discuss all facets of searching for, buying, and owning a turnkey investment property.
*Remember, caveat emptor still applies when buying a property anywhere. The information contained in this article was pulled from third party sites mentioned under references. Although the information is believed to be reliable, Norada Real Estate Investments makes no representations, warranties, or guarantees, either express or implied, as to whether the information presented is accurate, reliable, or current. All information presented should be independently verified through the references given below. As a general policy, the Norada Real Estate Investments makes no claims or assertions about the future housing market conditions across the US.
Overview of Irvine
Limited used home regulation
Quality of life versus rent
Deal for renters
Cooling housing market
Market Prices, Trends & Forecasts