Welcome back to the Real Estate newsletter. This week, we got an expert to say six magic words that many Angelenos have been waiting to hear for a long, long time: “It’s turning into a buyer’s market.”
The phrase was uttered in response to July housing data, which once again saw Southern California home sales plummeting and prices getting cheaper and cheaper.
To be clear: we’re still nowhere close to a market reset, and it’s hard to say if prices will ever return to where they once were. The pandemic pushed the market to dizzying peaks, and no one’s predicting a crash after years of record-breaking sales. But the last few months feel like the start of a new era — a spring flower emerging from the snow.
To properly explore the changing market, we checked in with sellers, many of whom are simply taking their ball and going home. Homes that once saw bidding wars are now languishing on the market, and many would-be sellers are deciding not to list their properties until the market takes off again.
Keep in mind, these trends are more-or-less limited to the regular housing market. All bets are off on the luxury side, and this week saw two high-profile sellers shoot for astronomical sums.
The first is Ben Affleck, who’s asking $30 million for his Pacific Palisades bachelor pad. It’s an ambitious price considering he paid just $19 million for the golf course estate four years ago and hasn’t made many changes.
The Oscar-winning actor has little use for the 13,000-square-foot mansion anymore. He recently married Jennifer Lopez, and the pair are looking for something a bit bigger.
Meanwhile, the world’s sixth-richest man, Larry Ellison, is eyeing an even bigger fortune for his oceanfront compound in Florida’s North Palm Beach: $145 million. The ask is even more ambitious than Affleck’s, since Ellison paid just $80 million for the property a year ago.
The tech mogul, whose net worth hovers around $110 billion these days, set the Sunshine State record when he moved to a nearby home earlier this year, paying $173 million for a somehow-even-more-impressive place.
Lastly comes an update from Downtown L.A.’s 6th Street, but this time, it has nothing to do with the newly famous 6th Street Bridge. In addition to the viral new viaduct, the street will be getting an $800-million studio complete with 16 soundstages to serve the entertainment industry.
With streaming growing, the demand for soundstages is at an all-time high, and multiple developers around L.A. County are looking to fill the need.
As always, while catching up on the latest, visit and like our Facebook page, where you can find real estate stories and updates throughout the week.
SoCal home prices dropped in July
In recent months, rising mortgage interest rates have put the brakes on a once-hot housing market in Southern California and across the country, writes Andrew Khouri.
With would-be buyers choosing to sit on the sidelines, sales are plunging and homeowners are slashing their asking prices to close a deal. Now, there are signs overall home values may be headed down as well.
“It’s turning into a buyer’s market,” said Keith Hernandez, a real estate agent with Realty One Group Synergy in Whittier.
Few, if any, economists predict a crash in values similar to 2008, but a growing number of experts say overall home values are likely to decline in the near future.
Sellers go on strike
As the housing market has slowed across Southern California and the country, sellers have had to adjust their expectations, writes Andrew Khouri.
Homes that would have received dozens of offers at the beginning of the year get just a few these days. Other properties receive none, forcing owners to slash their asking price and relinquish dreams of record profits.
Now, some would-be sellers are calling it quits altogether . Those decisions essentially cap how high inventory can climb, with broad implications for current homeowners and future buyers.
“It puts a floor on home values if people decide not to list their homes,” said Ralph McLaughlin, chief economist with real estate data firm Kukun, noting fewer homes to choose from helps keep prices from plunging.
Actor offers $30-million bachelor pad
Ben Affleck is offering up his bachelor pad in Pacific Palisades, listing a traditional-style mansion along the links of Riviera Country Club for $30 million.
If the actor gets his price, it’ll be the third-priciest sale in the coastal community so far this year. The 2022 crown currently belongs to Maroon 5 frontman Adam Levine, who unloaded his three-acre compound for $51 million in May.
Affleck has little use for the 13,000-square-foot showplace these days, which he picked up for $19 million in 2018. He since married Jennifer Lopez, and the pair have been touring a handful of luxury mansions around the Westside.
Billionaire shoots for $145 million
Tech billionaire Larry Ellison is chasing history in South Florida, listing his prized property in North Palm Beach for $145 million — a significant jump from the $80 million he paid for it last year.
If he gets his price, it’ll be one of the biggest residential sales ever in the Sunshine Shine. The Oracle co-founder set the record himself earlier this year when he paid $173 million for an even larger place a few miles down the coast.
Ellison — whom Forbes lists as the sixth-richest person in the world with a net worth of $110 billion — collects prized real estate like kids collect baseball cards. He’s been the most active in Malibu, where he spent the last few decades scooping up dozens of oceanfront homes in Carbon Beach and beyond, racking up a tab that has soared into the hundreds of millions.
His trophy estate in North Palm Beach offers an almost unprecedented amount of space along the ocean with 563 feet of water frontage. At 6.5 acres, it’s the largest oceanfront property currently on the market in South Florida.
New studio planned for Downtown L.A.
With movie and television production surging, a warehouse property near the newly famous 6th Street bridge in downtown Los Angeles is set to be turned into an $800-million studio to serve the entertainment industry, writes Roger Vincent.
East End Studios will submit an application to the city Monday to build a studio on 15 acres at 6th and Alameda streets where streaming services and other entertainment creators could make TV shows and movies.
With 16 soundstages, East End Studios’ ADLA Campus would be one of the larger studio projects in the pipeline for Los Angeles County, where several developers are rushing to add new facilities to meet demand.
Existing soundstages in the county have been almost fully rented for years, which can make it hard for new productions to find places to work, said Paul Audley, president of FilmLA, the nonprofit that handles film permits in the region.
“We’ve seen streaming growing at an average rate of 35% a year,” he said. “Even if that backs off, which some people are now predicting, we still don’t have enough stage space to deal with that.”
What we’re reading
The New York Times found a troubling tale in Maryland, where a Black professor had his house appraised at $472,000. When he removed family photos and had a white colleague stand in as the owner, the second appraisal shot up to $750,000. Now, he’s suing.
KQED profiled California’s YIGBY movement — also known as Yes in God’s Backyard — in which churches are attempting to build affordable housing on their abundance of undeveloped land. However, due to high construction costs, bureaucracy and NIMBY neighbors, the efforts have been far from successful.