Trouble Spots in the Best Areas of Los Angeles

As the housing slump, credit crisis, financial collapse and economic recession all continue, there are some disturbing trends in some of the best neighborhoods of Los Angeles.

Unquestionably, all areas of Los Angeles have felt this downturn. But not all areas have felt it equally. Nor will all areas ever be hit equally hard. Nonetheless, some of the better areas have some bad trends developing -- we'll see if they last.

First, as I've noted the last two months, some areas simply have too much inventory of Single Family Homes to not see additional price declines, most notably: Malibu (90265) with 33 months of SFR inventory, and West Hollywood (90069) with 30 months of SFR inventory.

But here's something new. A few zip codes that had seen low numbers of foreclosure auctions saw a spike up in foreclosure auctions in September, according to reports from PropertyShark.com, including:

• 90048 - from 1 to 5 - Beverly Center/Grove/West Hollywood


• 90403 - from 1 to 4 - Santa Monica (Wilshire to Montana)


• 90077 - from 1 to 4 - Bel Air/Holmby Hills


• 90068 - from 4 to 10 - Hollywood Hills


• 91316 - from 11 to 27 - Encino

However, sheer numbers of foreclosures are not as important until you put them in the context of the number of unsold homes/condos on the market. And some neighborhoods in last month saw a significant increase in new foreclosure auctions relative to the number of homes/condos on the market:

• Encino (91316) - 7% to 18% - new auctions as a % of unsold inventory


• North Hollywood (91601) - 4% to 11%

Those are not good trends for housing prices in those areas going forward over the next few months.

For my complete breakdown of "Trouble Spots in Prime Areas," CLICK HERE.

For the entire statistical analysis behind these "Trouble Spots," showing inventory and foreclosure trends in the best neighborhoods of Los Angeles, CLICK HERE.