It’s been six months since one of the worst wildfires in California’s history tore through the quaint but glittering neighborhood of Pacific Palisades, destroying more than $17 billion in real estate.
Since then, some residents have listed their burned lots for sale. Other sites have been cleared and prepped for new structures. Still other owners have unscathed properties, and some have listed them for sale.
The priciest of those still-standing homes is a $54 million new build. Santiago Arana, the listing agent, said the development had been in the works for years, so the plan was always to sell it. Then, the neighborhood caught fire.
The flames got close enough to show up on the property’s security cameras, Arana said. The house next door burned down. The newly built home made it through without so much as smoke damage.
It officially hit the market last month.
“If the Palisades didn’t burn, there’s probably a [chance] this would be a better market to sell it,” Arana, an agent with The Agency, told Homes.com.
'People are looking for value'
It’s a challenge facing agents across the region: Sales slated for this year, disrupted by January’s disaster, are now sitting on the market for longer at lower prices.
“It’s not for the faint of heart to move back into the Palisades right now,” said Trevor Zien, a real estate agent with a listing in the Palisades. “It’s going to be a construction site for a long time. So, it rules out a lot of the buying pool.”
So, how do you sell a house when part of its value proposition — its community — is reemerging from its decimation?
For starters, listing agents are addressing the elephant in the room.
"Property was unaffected by the fires," one property description reads on Homes.com.
"This hidden gem in the serene Marquez Knolls neighborhood of Pacific Palisades survived the fires and still offers an idyllic coastal lifestyle with warm midcentury charm," says another.
Others are more specific, referencing community and building.
"No houses on the street were lost to the fire and residents have been back enjoying their homes in this sought-after community," a nearly $4 million property's description reads.
"No need to build, this home is ready now," another listing agent wrote.
Perhaps the most potent lure, though, is lower prices, suggests Ali Rassekhi, a real estate agent with Coldwell Banker.
In fact, the median home sale price in the neighborhood is 8% lower than it was 12 months ago, according to Homes.com data. Part of that decrease could be because burned lots are skewing pricing data, but agents have reported cutting prices to attract buyers to still-standing homes.
Rassekhi, a Palisadian himself, has been listing and selling properties in the neighborhood since the fire.
One of those listings is a four-bedroom, four-and-a-half-bathroom home untouched by the fires. The property originally hit the market last year, but Rassekhi and his sellers took the listing down during the turmoil.
In April, they relisted — at a roughly seven-digit discount. The house has been on the market since then with a $9.95 million price tag.
“There are less people in the market,” Rassekhi said. “We wanted to reduce the price to make it more attractive to a smaller pool of buyers.”
Other sellers have taken a similar approach. Blair Chang, an agent with The Agency, said the price was reduced on a four-bedroom, six-bathroom Palisades house “to make it more appealing to buy.”
The house had listed for $13 million in early April. On July 1, the price was lowered to $11.95 million.
“It’s going to take several years for ... the burn-scar area to get back on its feet, and [buyers] know they’re going to be in the midst of construction,” Chang said. “People are looking for value.”
“I’ve told my sellers who have those turnkey houses in that location, you can put it on the market, we can try it,” he added. “But buyers in that specific location are looking for good value, meaning a discount.”
Different types of buyers are emerging
So far, there have been only a handful of standing-home sales in the burn area, according to public listings on Homes.com. Many of those have been at a discount, too.
Demand has started picking up, though, especially in the past two weeks, since the neighborhood officially reopened to the public.
Rassekhi, for example, said he's had more interested buyers reaching out to him since then. As he’s gotten more calls, he said, a few types of buyers have emerged.
For one, there are the locals who are navigating the rebuild process and want to live in the Palisades in the meantime.
“They miss being back in their own area; it’s a real-human thing,” Rassekhi said. “I’m getting a lot of calls from locals whose homes burned. They want to rebuild, but they want to live in the Palisades while they’re rebuilding because it’s an emotional thing.”
There are also residents who don’t want to rebuild but are looking to return to the neighborhood. Zien, from The Agency, said that in those cases, it can sometimes be less expensive and easier to buy a still-standing home.
“Build costs are so expensive right now,” he said. “The idea of rebuilding can be daunting and expensive, so getting something, even if it means they don’t move in right away" seems more desirable.
Zien listed a five-bedroom, seven-bathroom house in early June for just shy of $7 million. It’s still on the market.
There are also, of course, more opportunistic buyers, too. Rassekhi said he’s heard from people out of state and even from outside the United States who see buying in the Palisades as a chance to get into an otherwise exclusive and pricey area.
“These are people who … tried for the last five, seven years to buy in the Palisades, got outpriced, got outmarketed,” he said, “and now there’s an opportunity.”
Arana, who holds the $54 million listing, said that kind of buyer could be especially interested in his property despite — and maybe because of — the fires.
“Maybe there are less people who want to be in the Palisades, but if someone wants this specific kind of house with these kinds of views and what it has to offer … there’s the option to be in the Palisades for a lot less,” he said.
As the recovery process continues, though, the only certainty is the uncertainty of what’s to come, but local agents say they are hopeful.
“It’s all to be written,” Arana said. “We’re creating our own new story in the Palisades.”