The recent initial public offering (IPO) of SpaceX has created thousands of new millionaires and is beginning to impact the Southern California real estate market, according to a new report. The aerospace company's stock debuted at $135 per share on June 12, a price that has since seen an increase, positioning employees for significant financial gains.
Despite SpaceX relocating its headquarters to Texas, the company maintains a substantial engineering and production hub in Hawthorne, Los Angeles County, employing over 7,660 individuals. Real estate agents in areas from Hawthorne to Manhattan Beach, Venice, and Santa Monica have reported an uptick in inquiries for properties valued at $5 million and above.
This surge in potential buyers has raised concerns among some agents about speculative price increases and a further tightening of already limited inventory. "People are starting to look, and most will spend $5 million or more," one real estate broker told the Los Angeles Times. Another agent expressed optimism for an uptick but cautioned about the sustainability of price inflation.
The median single-family home price in California stands at $930,260, with Los Angeles County nearing $999,000, according to the California Association of Realtors. Although SpaceX's stock price has seen fluctuations, it remains substantially higher than its IPO price.
For many SpaceX shareholders, a "lock-up" period restricts the immediate sale of shares. Unlike the typical 180-day period, investors holding pre-IPO shares must adhere to a tiered, rolling schedule for selling. Experts suggest that the full effect of the IPO on the housing market may take several months to materialize. One instance noted is a new SpaceX millionaire expressing interest in a $32 million property in Brentwood.