I got a hot tip from a wholesaler claiming he got an off market deal. Existing duplex with 7700 SF of lot, and could be delivered vacant in 90031 (Lincoln Heights). I liked the lot profile because it allows plenty of space to expand on existing buildings or simply more units. I was also excited about delivered vacant as I don't have to deal with tenant relocations since the moratorium is still in place for City of LA.
I entered the address into ZIMAS (http://zimas.lacity.org/) and found out the property is overlaid under HPOZ: historical protection overlay zone. Big red flag! HPOZ is probably one of the worst zoning overlay for developers and investors. Why? Because there will be a special committee dictating over your exterior design and material selection. If they don't like it, they can reject your project anytime for whatever reason. The planning lead time is also unpredictable. I have heard from developers that it took them over one year and their plans are still not approved. That's why you see plenty of old run down craftsman houses are selling 20% below the market. Your architect must know how to maneuver the archaic building code and deal with the HPOZ committee. Your contractor must be knowledgeable at restoring historical buildings. Some of the materials and workmanship are not even available in Los Angeles, and you will have to import them.
However, if you could restore one of these Victorian or Craftsman houses back to their original condition, the market is willing to pay 15-20% premium over it. Check out Carroll Avenue near Echo Park. The whole street is filled with these old restored Victorian and Craftsman houses, and they are not cheap!
For more info about HPOZ:
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