Real Estate newsletter: A Beverly Park mansion makes history
Welcome back to the Real Estate newsletter, your weekly window into a Southern California market that’s so hot, it’s making history.
The six-county region’s median home price hit an all-time high earlier this year, and bidding wars for the small supply of homes on the market probably won’t slow down anytime soon.
Another record was registered in the star-studded neighborhood of Beverly Park, where an Italian-inspired mansion was auctioned off for $51 million — the most ever paid for a home at an auction. A second celebrity-filled enclave, Hidden Hills, saw a major listing as well when French Montana offered up the home he bought from Selena Gomez.
Buyers, beware. In March, more than half of all homes that sold in the city of L.A. fetched more than the asking price, and some communities saw as many as 70% of homes sell above the price tag.
Homebuyers may not have many options to choose from, but at least there are plenty of styles. Columnist Patt Morrison explored Southern California’s almost comical abundance of home styles, from antebellum plantation mansions and Tudor half-timbered houses to Craftsmans and French chateaux.
Some of the Bay Area’s tech wealth is coming south — South Los Angeles, specifically. Housing reporter Andrew Khouri looked into Mark Zuckerberg’s $5-million plan to help homes stay in the hands of small landlords in the community that’s been hit hard by the pandemic.
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Home auction makes history
A glass-half-full, glass-half-empty sale recently closed in Beverly Park, where an Italian-inspired mansion called Villa Firenze sold at auction for $51 million. The deal makes it the priciest home to ever be auctioned off, but the final number is more than $100 million shy of its original price tag of $165 million.
Although the official sale price in the public record is $51 million, an additional deal with furnishings from the home brought the tab up to around $60 million, according to a source familiar with the deal.
Spanning 10 acres and centering on a 28,600-square-foot mansion, the estate had been floating on and off the market since 2017. It surfaced for sale at $160 million last summer before eventually hitting the auction block with no reserve earlier this year.
It’s Southern California’s most expensive on-market real estate deal so far this year, beating out Ellen DeGeneres’ $47-million sale in Beverly Hills, according to the Multiple Listing Service.
From pop star to rapper to someone new
In the star-studded neighborhood of Hidden Hills, rapper French Montana is asking $5 million for a home he bought from Selena Gomez five years ago.
That’s $1.7 million more than the Moroccan native paid in 2016, records show. During his half-decade stay, the hitmaker behind “Pop That” and “Unforgettable” added a custom $400,000 recording studio and painted gray over the bold shades of purple and turquoise that covered the walls when Gomez lived there.
Hidden Hills is known for its privacy and space, and Montana’s place is sprawled across more than 3 acres in a small, gated 11-home enclave known as Mureau Estates. A motor court marks the front of the property, and inside, five bedrooms, five bathrooms, five fireplaces and amenities such as a gym, movie theater and wine cellar are spread across 8,600 square feet.
Bidding wars are a seller’s paradise
In Southern California, where home buyers are seasoned bidding-war combatants, demand lately has been pummeling supply so badly that some neighborhoods are seeing most homes fetch far more than owners were asking.
The six-county region’s median home price hit an all-time high in February of $619,750, according to the most recent data from real estate firm DQNews, as buyers strengthened by low interest rates fought over the depleted roster of homes for sale. L.A. County’s median sales price rose 14.3% year over year to $708,500.
But the median price — the point at which half the homes sold for more and half for less — gives a broad overview. Exactly how bad is it out there?
Within L.A. city limits, more than half the homes sold in March fetched more than the listing price. Of the 565 properties that traded hands, 287, or 50.8%, hauled in more than the price tag, according to the Multiple Listing Service real estate broker database. A year earlier, 44.2% of homes sold for over the asking price. In March 2019, that figure was 36.1%.
In Lancaster, where homes typically sell in the $200,000 to $400,000 range, nearly 71% of homes sold for more than the asking price.
L.A.’s home styles explained
If you can afford it, the impulse that brought millions to live in Southern California also bequeathed us a landscape ornamented with marvelous houses, writes columnist Patt Morrison.
Our home heritage is as multi-everything as Los Angeles itself — historical hybrids of imagination and redwood and whims in stone.
You can drive some neighborhoods — like the flats of Beverly Hills, between Sunset and Santa Monica boulevards — and see them all at once: antebellum plantation mansions and Tudor half-timbered houses across the road from Craftsmans and French chateaux and Mission Revivals. It’s like a studio backlot, every kind of house available to suit the shooting needs of the next movie.
Silicon Valley cash comes to South L.A.
Tech wealth is coming to South Los Angeles — but not in the way some other neighborhoods in the city have become accustomed to, writes housing reporter Andrew Khouri.
A new program backed by the personal philanthropic company of Facebook founder Mark Zuckerberg and his wife, Priscilla Chan, aims to help small landlords there so that properties stay in the hands of locals, stay affordable to locals and help build wealth within the community.
The Los Angeles Local Rental Owners Collaborative, or LROC, is a joint effort of nonprofits, an online property management firm and the Chan Zuckerberg Initiative. It will put $5 million in the hands of landlords — particularly those slammed by the COVID-19 pandemic — to pay for rent owed by struggling tenants, and for any needed building repairs.
The program will also provide financial coaching for small landlords, including helping them pool resources to gain discounts on insurance, mortgages and legal services.
What we’re reading
U.S. housing supply is a bit short of demand — 3.8 million homes shy, according to a new report from housing company Freddie Mac. The analysis also found that the housing supply crunch increased by 52% from 2018 to 2020, which partly explains why homes are getting more and more expensive.
A few Uber veterans are making their way into the real estate industry via Doorstead, a new start-up that helps homeowners rent out their place. They recently raised $12.5 million in funding, according to GeekWire.
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