Home sales fell by double digits in the Pacific Palisades and Altadena in California after January’s Los Angeles wildfires, according to a new report from Redfin.
In the Palisades 12 homes sold in February, down 56 percent from a year earlier. In Altadena, 32 homes sold, a 43 percent decline year-over-year.
Home listings fell in neighborhoods hit by the wildfires, too. Listings slowed a bit in February—but not nearly as much as sales. There were 23 new listings in the Palisades, down 12 percent year-over-year, and 46 new listings in Altadena, down 6 percent.
Sale prices dropped in Altadena and rose in the Palisades. The typical Altadena home sold for $1.2 million in February, down 8 percent year-over-year. But in the Palisades, one of the most expensive neighborhoods in Los Angeles, homes grew even more expensive; the typical home there sold for $2.9 million, up 32 percent year-over-year.
Redfin noted it stands to reason that home sales and listings dropped, as the Palisades and Eaton wildfires destroyed thousands of homes. Many of the people who were displaced by the fires moved into rentals rather than buying a new home, and many who didn’t lose their homes paused their house hunt as the wildfires wreaked havoc across the region.
Redfin agents say would-be homebuyers and sellers in the Palisades and Altadena adopted a wait-and-see approach. Many homeowners kept their homes off the market because they were worried values would go down, and some house hunters canceled contracts because they were nervous about insurance costs and possible future fires.
Now that a few months have passed since the wildfires, Redfin agents report some house hunters who were looking in the Palisades or Altadena before the wildfires are looking in those neighborhoods once again—but away from vulnerable streets.
“I’m now working with a mix of people. Some of them were looking before the fires, and some started looking after,” said Sam Najarian, a Redfin Premier agent who works primarily in Altadena and Pasadena. “Most people want to stay away from the hillsides post-wildfires; they’re looking in flat residential communities. Of course they know living in the hillsides puts them at higher risk of wildfires, but insurance companies are also making it very tough to buy in the hills. Many of them are asking for inspections, which I’ve never seen before, and giving astronomical quotes.”
While homebuyers and sellers backed off from the Palisades and Altadena the month after the wildfires, activity picked up in the Los Angeles metro as a whole.
Home sales rose 6.2 percent year-over-year in Los Angeles in February, a bigger increase than any other major metro area, and new listings rose 13.6 percent. The area’s median sale price increased 5.1 percent to $920,000, just shy of the all-time high.
The Los Angeles market is accelerating mostly due to pent-up demand, Redfin reported. Many prospective buyers and sellers backed off in January and returned to the market in February. Los Angeles agents say there are pockets of the metro area, especially places considered relatively safe from fires, where every listing is selling quickly with multiple offers.
New listings rose significantly in February in many neighborhoods close to the Palisades and Eaton fires but not directly impacted by them. That’s partly because many people who were displaced by the fires needed a new place to live and many homeowners in adjacent areas listed their home to meet demand.
For instance, in Palisades-adjacent Brentwood, home sales rose 23 percent year-over-year in February and new listings shot up 81 percent. In La Canada Flintridge, located next to Altadena, new listings increased 34 percent, and in Pasadena, also next to Altadena, new listings rose 63 percent.
Sales and listings also soared in parts of Los Angeles farther from the fires. In Manhattan Beach, located in the southern part of Los Angeles County, home sales rose 58 percent year-over-year in February, new listings rose 72 percent, and prices increased 19 percent.
“One thing I’m noticing: people I met with six months or a year ago are suddenly calling, saying they want to list their homes,” said Thomas Royds, a Los Angeles Redfin Premier agent who focuses on places in southern Los Angeles. “Many of them want to capitalize on the demand and high prices from people who were displaced by the fires, and are now moving from a short-term rental into a more permanent home.”