It was around a century ago when a stretch of Wilshire Boulevard, between Sycamore Avenue to the east and Fairfax Avenue to the west, was developed into a shopping area. The idea was to have this sprawling strip accommodate cars, and passers-by would be enamored by the displays organized by local merchants. Soon, this stretch of Wilshire Boulevard would be known as the “Miracle Mile.”
Today, Miracle Mile in Los Angeles has become not only a popular tourist attraction, but also an affluent neighborhood. Its strategic location puts it near thriving business centers, exciting entertainment venues, other major communities in LA, and the city’s major museums. Budding investors looking for an ideal location should consider Miracle Mile as the best choice when it comes to real estate investing for beginners.
Before getting into the nitty-gritty of buying an investment property in this hotspot and sharing tips on coming up with a real estate investing strategy, let’s take a closer look at Miracle Mile and its current real estate market.
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ABOUT MIRACLE MILE
As its name denotes, Miracle Mile is a mile-long section of Wilshire Boulevard located between La Brea and Fairfax Avenues. From this Mid-Wilshire location, everything and everywhere is within reach – Miracle Mile is between Beverly Hills and Koreatown, south of Melrose, and two miles west of Downtown LA. It’s also a few miles north of the 10 freeway.
Miracle Mile in Los Angeles was the dream of A.W. Ross, who first purchased 18 acres of land along the boulevard in 1920. Back then, it was an unpaved farm road, though it is close to three of the wealthiest residential districts at the time, namely Westlake, Hollywood, and Beverly Hills. Despite the odds (and doubt among Ross’ peers), his gamble paid off, and the area around Wilshire Boulevard became the home of million-dollar properties. Thus, the former stretch of dirt road became the aptly named “Miracle Mile.”
However, there were already houses in the area even before A.W. Ross bought the land around Wilshire Boulevard. A subdivision was established back in 1881 when Germaine Pellissier, a sheep rancher, sold over 40 acres of his property. In fact, Wilshire was originally subdivided to encourage the development of residential properties.
What’s popular in Miracle Mile
- Museums. Today, Miracle Mile is a bustling center of life, culture, and opportunities. Businesses and real estate investors are fascinated by its ideal location, while visitors are entranced by the wealth of activities and attractions that can be found here. Most popular among them is the artsy arrangement of street lights that often serve as a backdrop to a lot of Instagram posts. The street lights are actually an art installation called “Urban Lights” that sit in front of the Los Angeles County Museum of Art, or LACMA.
LACMA is part of the renowned Museum Row in Miracle Mile, a three-block stretch which also includes the La Brea Tar Pits Museum, the Craft and Folk Art Museum, and the Academy Museum of Motion Pictures, the largest museum in the United States devoted to movie making.v
- Food trucks purveying global cuisine. The culinary scene in Miracle Mile is very much alive as well, and it’s not just because of the numerous fine dining spots and gastropubs in the area. Miracle Mile is also the place where numerous food trucks park and sell a diverse selection of dishes, from Cuban to Korean, organic to vegan, and then some. i
Though Miracle Mile is known for their specialty shops, with items that cater to tourists and visitors, places like The Grove and Beverly Center just a couple of minutes’ drive away from Miracle Mile, are go-tos for bigger-ticket buys.
- Walkability in unwalkable LA. Perhaps the biggest draw in Miracle Mile is its walkability. It is rare for a famously unwalkable city like Los Angeles to have a neighborhood where everything, from shops to restaurants, is easily accessible by foot. Even more astonishing is the fact that, despite being in the middle of a bustling urban area, Miracle Mile has a surprisingly laid-back atmosphere, as seen among residents.
All of these attractions and amenities make Miracle Mile one of the top locations among both first-time and seasoned investors who are buying an investment property.
REAL ESTATE INVESTING IN MIRACLE MILE, LA
Part of real estate investing for beginners is to learn more about the area’s current real estate market, especially if it’s a sought-after location like Miracle Mile.
As of September 2023, homes for sale in Miracle Mile, Los Angeles were listed at a median price of around $1.3 to $1.5 million. At $655 to $756 per square foot, the median price is lower compared to homes during the same period in 2022. Listed properties in the neighborhood tend to stay in the market for around 50 days.
Why invest in Miracle Mile, LA?
What makes a popular tourist attraction like Miracle Mile an ideal location when buying an investment property?
- Proximity to some of LA’s major thoroughfares such as Wilshire Boulevard, Fairfax Avenue, West Third Street, and San Vicente Boulevard is part of what makes it special. You can be everywhere and anywhere in LA from Miracle Mile, and you can take one of the many bus routes or ride a bike if you don’t want to be stuck in traffic, especially during peak commute hours.
- Amenities and home styles. Most of the historic homes in Miracle Mile, Los Angeles are mid-sized stucco cottages. Spanish-style homes are common in Miracle Mile, with their arched windows and clay tile roofs. Some of the more affluent have preferred chateau-like Hollywood Regency homes with spacious driveways and private pools. Apart from these homes, Miracle Mile also has plenty of condos, with a 2-bedroom-units priced at around $875,000.
- Life beyond tourist attractions. Other than the popular tourist destinations, Miracle Mile also boasts community parks where residents can rest, play, and simply watch others enjoy the wide open spaces. The Hancock Park La Brea in the Miracle Mile district has landscaped areas and open spaces for walking, picnicking, and other outdoor activities.
- An above average school district. Miracle Mile is also located within the Los Angeles Unified School District, which is rated above average. Kids can attend Hancock Park Elementary School, John Burroughs Middle School, and Los Angeles High School. There are Catholic schools and yeshivas that cater to Miracle Mile locals as well.
Investment opportunities in Miracle Mile
Buying an investment property means learning about other opportunities in the area, and Miracle Mile is rife with possibilities.
- Rental properties will always be in demand. While there is a glut of office space in LA. because of the way hybrid work emptied many buildings, Miracle Mile continues to be occupied by law firms, advertising agencies, public relations offices, publishing companies, and entertainment corporations, to name a few.
In February of 2023, Sony Pictures Animation announced plans to move their operations to Miracle Mile once their lease at The Culver Studios Building in Culver City expires. The studio plans to move to a 225,000-square-foot property at Wilshire Courtyard by April 2024. Sony joins NBCUniversal and the SAG-AFTRA building, which are also located on Miracle Mile.
Sony’s move will also entail the relocation of around 700 workers, which will translate to an opportunity to welcome new residents to rental and residential properties in Miracle Mile.
- Turning office buildings into housing. Since LA’s Adaptive Reuse Ordinance went into effect in 1999, existing buildings that have been reused led to the creation of 12,000 housing units . Today the City Planning Department has expanded eligibility to include:
- All buildings completed before 2008
- All buildings between 5 and 15 years with zoning approval
While some have viewed this solution as expensive and logistically challenging, given the fundamental design differences between office buildings and a thriving residential community, the planning commission believes their solution will address the persistent problems of affordable housing and sustainability. As for demolishing old buildings, the commission estimates that “it can take up to 80 years to recover the energy that went into the demolition, production, manufacture and transportation of new building materials.”
HOW TO INVEST IN A PROPERTY ON MIRACLE MILE
Now that buyers have a snapshot of Miracle Mile’s real estate market, there are a few more things they need to look into before they leap:
What is the investor’s long-term goal?
When it comes to investments, real estate will require hard work, dedication, patience, and money – but the returns could be significant if the investor knows exactly what their long-term goals are from the outset.
Most of the time, investors who simply seek to generate passive income from rent will look for properties that offer accessibility to amenities, like shops, schools, and hospitals. Long-term investors, meanwhile, will prefer to look at properties in up-and-coming locations that might see an uptick in value in the future.
Determining the purpose in investing in a property will guide the buyer in choosing the type of property that will help them achieve their goals, whether for the short term or the long term. Generally speaking, however, one will want to aim for long-term growth for their investment property, because the goal is usually to sell it for more than the amount originally paid for it.
What are the costs of investing?
Real estate properties don’t come cheap, and the costs can pile up even after closing the deal. A buyer can set a budget and find a property that’s within this range, but they will also need to consider the costs that come with investing, such as basic maintenance, yearly upkeep, upgrades, taxes, and insurance.
Buyers who plan to take out a loan for this investment will also need to consider real estate investment trusts or REITs. This option allows individuals to invest in a diversified portfolio of real estate assets by owning, operating, or financing income-generating real estate across various sectors. Property types include commercial real estate (like office buildings, shopping centers, and hotels), residential properties, and infrastructure (like data centers).
What are the results of the market research?
An effective real estate investing strategy starts with an in-depth knowledge of the area’s real estate market. In a specific area like Miracle Mile, investors will look at trends that may affect the market in the short and long term.
Market research fills knowledge gaps and tells potential investors that being on top of the game and identifying opportunities that still exist are reasons to partner and forge ahead.
What are the risks?
Negative cash flows, problematic tenants, or even high vacancies are just some of the risks that come with any real estate investment. On top of that, the real estate market itself has been volatile as of late, with unforeseen national and global events having an impact on the value of properties.
Risks are unavoidable. However, investors can incorporate contingency plans to limit risk. Creating strategies to retain tenants is one of them, but investors can also consider diversifying their portfolio and buying shares in REITs.
What is the right investment property?
There are numerous options for real estate properties, but the right one aligns with one’s long-term goals. For instance, if the investor is looking to earn passive income, then they can opt for residential properties and lease out the home or apartment, or even rent it out for short-term stays. Alternatively, the buyer can flip the property and sell it for a quicker return.
Setting a goal for one’s real estate investment will help determine the right type of property.
Why work with a real estate agent?
An effective real estate investor doesn’t work alone; they understand that such an investment is a huge undertaking and that it’s better to work with professionals who can share their industry knowledge on the real estate market. Help from real estate professionals is indispensable, especially in determining the right location, the right property type, and even the right time to invest in real estate.
Top brokers and Realtors have spent years cultivating a local network, keeping up with changes in the community or neighborhood, and parlaying this knowledge to the advantage of their clients. At the end of the day, both buyer and real estate agent share the same goal: to make the most out of the investment and to make sure that the investment is worth every penny.
What’s in it for the investor?
Real estate investing for beginners can be challenging, but, when done right, the returns can be rewarding. The benefits are myriad and well-known:
- The opportunity to earn passive income
- The opportunity to enjoy real estate tax benefits
- The opportunity to see the property appreciate in value over time
- The opportunity to sell it for a profit
- The opportunity to build wealth
- The opportunity to begin (or diversify) an investment portfolio
- The opportunity to use leverage, such as mortgages, to finance property acquisitions
- The opportunity to hedge inflation, which erodes the purchasing power of money, through a fixed-rate mortgage – the amount paid in interest remains constant, regardless of inflation.
Given all these benefits, it’s still important to understand that achieving success in real estate comes with hard work and perseverance. That’s why investing in real estate is something that one should pursue with help of a reliable and trusted professional.
INVEST IN YOUR FIRST MIRACLE MILE PROPERTY WITH CLUTCH ABODE
Trying your luck at investing in a competitive real estate market like Miracle Mile? Make sure to work with experienced brokers and Realtors who can show you the ropes and lead you to the property that serves your long-term goals. When it comes to experienced Realtors, there’s no better team than Clutch Abode.
Owned and managed by Clinton Wade, Clutch Abode has been in the business for 20 years with a track record of serving some of the most distinguished names in LA. This boutique real estate firm has closed multi-million dollar deals on homes in some of the city’s most affluent neighborhoods like Miracle Mile, West Hollywood, and Bel Air.
The Clutch Abode team has established a brand of responsive and hands-on service. Clinton Wade’s key connections with agents, brokerages, and contractors make the entire process of investing in a real estate property as smooth and hassle-free as possible.
Whether it’s your first or fifth real estate investment, make sure that you have in-depth knowledge and market experience that only a team of expert Realtors can provide. Start your journey to real estate investing with Clutch Abode by booking a private consultation today. Call 310.403.9497 or contact us here.