A new report out from Douglas Elliman Real Estate spells out just what a banner year some high-end neighborhoods in Los Angeles had in 2014, and just what a bummer year it was in the less high-end 'hoods. The report includes "Greater LA" 'hoods from the coast (Malibu and Playa del Rey) all the way over to Highland Park in Northeast LA, roping in Downtown, the Westside, and ritzy neighborhoods like Brentwood, Malibu, and Pacific Palisades, but leaves out South LA. What it says is that while prices in the "luxury" market have passed their previous peaks, the rest of the market has not fully gotten its footing back post-recession.
According to the report, overall prices rose ever-so-slightly (.2 percent) in the fourth quarter of last year, pushing the median price all the way up to $885,000—a 7.3 percent rise over 2013's fourth quarter median. LA's "all-time high" was in the second quarter of 2014, when LA-area houses commanded $895,000, says Bloomberg.
But the "luxury" sections of LA's market (defined here as the top 10 percent) were the big winners, seeing the average sales price of single-family houses increase by 4 percent. The fourth quarter average price in those areas? $7,321,288. That's a 9.6 percent jump up from 2013's fourth quarter, when houses were selling for an average of $6,430,835.
Of all the expensive, exclusive 'hoods highlighted in the report, single-family houses in Santa Monica saw the biggest increase in median sales price; it rose 16.8 percent to $2,191,050 from the previous quarter and was 20.6 percent higher than the previous year, when the median price was $1,817,750. Beverly Hills had the highest average sales price, $7,136,242, probably assisted by the record-setting sale last quarter, when Minecraft creator Markus "Notch" Persson paid $70 million for a spec house that Beyonce and Jay-Z had previously been eyeing.
Report preparer and appraiser Jonathan Miller says it's important to note the activity in the top tiers of the market, where "Sales activity remains high and prices have exceeded the records set at the pre-financial crisis peak in 2007, unlike the entire city," probably because these folks are operating outside the standard workings of home financing.
· 4Q - 2014 Greater Los Angeles Sales [Douglas Elliman]
· The 10 Most Expensive Places to Buy a House in Los Angeles [Curbed LA]