LOS ANGELES—There are few things that spook John Chang. While caution is always called for, he sees little endemic to the local market that can derail the growth of the multifamily market. And in fact, one of the threats he had mentioned in our interview has since virtually disappeared. With the resolution of the labor disputes at the Port of Los Angeles, the massive backlog of goods can flow again and discretionary spending will rise.

In this second in a series on the Los Angeles market (click here for an analysis of the office and industrial markets) the Marcus & Millichap first vice president explains that problems on the horizon are not endemic of L.A. real estate and finance but beyond our control, what he describes as “macro headwinds,” such as a possible downturn in the national economy, international tension and the threat that oil prices could actually drop lower. “The steep decline [in prices] has put a lot more money in people's pockets,” he says, “but this is very volatile, and if they drop again under $40 a barrel that could cause big risks to the US economy.”

So Chang encourages caution. “We've seen it before when everything is going along nicely and then the housing bubble bursts,” he warns. But for the immediate road ahead, he sees few bumps.