[Oldeconomybuyer]

I sold a home in Northern California in 1999 that I thought was at its peak. Since then, it' gone up in value an average of over 25% per year.

That said, there are two basic schools of thought, a) there surely will be a housing correction in LA at some point, and b) home prices in LA are following the law of Supply and Demand.

It goes against my basic instincts, but I subscribe to the latter. I simply believe that as long as the LA area is attractive to both domestic and foreign buyers, home prices will remain at least stable if not robust. Barring a catastrophe, buying a home in LA is a safe bet.

[CatoRenasci]

Don't neglect the effect of low interest rates on the equation. What's worth more today at very low rates would be worth substantially less at 10% interest rates, let alone the 18% we saw in the Carter era. Do the math. Also consider the general availability of money to borrow. Lenders won't lend if their rates of return (interest is the cost of money plus the risk factor) don't work out.

My view is that LA is a bubble waiting to happen. Of course, I live in a similar East Coast bubble.