Is it possible to get a "good" deal in downtown Los Angeles right now? Expert advice needed.

[Jason J.]

I'm definitely a newbie at real estate ownership / investing, but I'm in a situation that I hope some better experts can analyze for me. I apologize in advance for the beginner-speak :)

Here's my situation:

I'm trying to buy a 1-bedroom apartment in downtown Los Angeles, particularly in the 90017 zip code (Here is a better diagram of location: http://bit.ly/1urYTX0 - the closer to 7th/Figueroa the better). 

However, I'm worried about the market being "too hot" or prices being too high - I have money for the downpayment and can comfortably pay rent, but I don't want to buy something at the wrong time and then have the place plummet in price.

My budget for a 1-bedroom apartment is 250-400k, and I want to live in it for 5-10 years, and then rent it out for a reasonable price (or at least one that covers mortgage/HOA fees) after I move. I love the area and I want to live in it for the short-term, but definitely don't want to raise a family in downtown 5-10 years from now. I'm 27 years old.

Are there any experts that might have any advice for me? What would you do in my situation? Is it possible to find a deal like this in the area, or am I "too late" to the party? What might I be missing? 

I TRULY appreciate any advice - I'm trying to create a plan of action to make ownership a reality, and I really don't like paying 1700/mo for "empty" rent right now. I'm trying to buy a place with Renting in mind down the line. My only requirement is that I stay within that zip code.

Edit: I can also slightly "increase" my budget for a bigger place (2-bedroom, etc) if that makes more sense from a renting perspective (+/- 150k)

[Amit M.]

I think your basic plan is a good one- buy a 1 or 2 BR place that works for you now, in a good up and coming location. Then years later you keep it as a rental when you buy a bigger place, get a life partner, etc. That's the smart way to build RE wealth. 

I'm not an expert on the LA market (my market is SF) but I know DT is revitalizing, and probably is a good bet for future appreciation. I don't know if the DT market is maxed out right now, but it will always seem expensive. I'd talk to numerous RE agents, follow articles in the LA Times about this, go to RE meet ups in the area, search this forum, and try to make an assessment on that. Even if DT is expensive now, look for a good deal for a good unit. Remember that in general costal CA usually has one of the best appreciation rates in the country, but can drop temporarily during a downturn. I don't know many people who brought CA property 10+ years ago who regret it. Even the 2008 downturn is starting to fade a away, as most of costal CA is at or above the 2007 highs. And that recession was more substantial than any we have had in years. Most likely you make a wise purchased now, and in 5-7 years you haven equity, plus rents will have increased by a few hundred bucks, and you have a great to long term investment. I brought my first condo in SF 20 years ago, and now I own 11 prime units in the city and live off my rental income.  Key to success is to buy in prime or up and coming locations.  It's tough starting out and everything seems super expensive, but stay focused!