Million-Dollar Houses a Dime a Dozen Now in San Diego : There’s No Dearth of Buyers for Such Luxury Properties
As recently as 1980, the number of houses that sold for $1 million and more in San Diego could be counted on one hand.
But last year in La Jolla alone, 24 houses were sold for $1 million or more, and this year real estate brokers expect the total could be between 35 and 50.
Currently, more than 150 houses priced at $1 million and up are for sale in San Diego County. Although most are in La Jolla, Rancho Santa Fe and Fairbanks Ranch, a few can be found in Coronado, Point Loma and Mission Hills.
By comparison, the average price for a single-family house in San Diego is about $150,000.
More-expensive houses are appreciating in value because in some areas--including La Jolla and Coronado--there is little available land on which to build new ones. Existing houses are becoming even more valuable as demand for housing in these communities increases.
What’s more, luxury houses are selling more briskly than ever before.
It used to take an average of two years to sell one of these expensive houses, but most now sell in one year or less, according to real estate brokers.
Houses now being shown include a palatial La Jolla hilltop mansion with a price tag of $12.5 million, and a 33-acre Rancho Santa Fe estate for which former San Diego Chargers owner Gene Klein is asking almost $15 million.
“Fairbanks Ranch buyers want all the bells, whistles and toys imaginable, like a remote control stereo which can operate from the rubber raft in the middle of the swimming pool,” said Andrew E. Nelson, president of Willis M. Allen Co., a La Jolla-based real estate broker. “The kitchens have every appliance and gadget from the latest edition of Home and Garden and Architectural Digest.”
Fairbanks Ranch attracts many buyers who want land--most houses are built on lots of an acre or more--and security--it is a gated community with 24-hour guard service, said Marge Crawford, a real estate agent with Fairbanks Ranch Realty Company.
Buyers who choose Rancho Santa Fe want exclusivity, Nelson said.
“This buyer likes dirt, trees and a feeling of separation from neighbors,” Nelson said. “The outside of the house might be rustic and simply shrouded, but inside there might be a few remote controls.”
Traditionalism, an ocean view and access to the village draw buyers to La Jolla.
“Most million-dollar-plus buyers in La Jolla want the shroud of conservatism, but inside they want to have everything,” Nelson said.
Coronado offers a low crime rate, a desirable climate that is cooler in the summer and warmer in the winter and a fine school system, according to Anthony Furlano, a Coronado-based real estate broker with Coldwell Banker.
“Coronado is more of a low-key community, much less flashy than La Jolla, for example,” Furlano said. “A $1-million house may be next door to a $250,000 home. There are new cars and old cars. You may not know you are driving by a home where people are very wealthy.”
Coronado’s unique claim is “that we don’t have a right side and a wrong side of the tracks,” Furlano said.
Mission Hills and Point Loma attract traditional buyers who want to blend the charm of an older house with a community that is close to downtown.
Despite publicity generated by an influx of wealthy foreigners and out-of-towners, most of San Diego’s luxury houses are purchased by San Diego residents. Most are successful business owners and executives, principally in the high-technology or real estate fields, according to brokers. Other high-priced houses are purchased by professionals, including doctors, lawyers and accountants who are moving from San Diego residences acquired years ago when prices were lower.
The homes are being sold to buyers in their 30s and 40s, brokers said, because wealthy elderly buyers, remembering when the homes cost much less, often resist paying high prices.
Brokers said the image of a fussy, obnoxious, hard-to-please wealthy buyer is incorrect.
“These buyers are easy to deal with,” said Peggy Chodorow, a real estate broker with the La Jolla office of Coldwell Banker. “They are decisive and want to move quickly. And they have the resources. It’s easier to sell these homes than a $150,000 house in Clairemont.”
Last year, Chodorow sold 71 houses in La Jolla for a total of $26 million. Her average works out close to the La Jolla average selling price of $432,500 for a single-family house. Including condominiums, the average last year in La Jolla was $340,200, according to figures published by the La Jolla Real Estate Brokers Assn.
Many buyers pay cash. Others, because they are preferred customers at financial institutions, arrange their own financing, Chodorow said.
One buyer even came to the escrow closing with more than $1 million in cash in his briefcase.
Most of all, people who buy these houses are looking for a view--of the ocean if in La Jolla or Coronado--amenities such as a swimming pool and tennis court, a feeling of spaciousness and curb appeal, Chodorow said.
Other features found in these houses include wine cellars (and some have more than one), marble floors, state-of-the art security systems, maid’s quarters, 10-foot or higher ceilings, elevators, multiple fireplaces, elegantly detailed moldings, dumbwaiters, sub-zero refrigerators and racquetball courts.
One Rancho Santa Fe house now on the market even has its own underground gasoline storage tanks so the owner can stock up in case there is another gasoline crisis.
The most expensive house currently for sale in La Jolla, a palatial estate on two secluded acres on a mountaintop with commanding views of the Pacific Ocean, carries a $12.5-million asking price.
The 1,600-square-foot master bedroom suite contains his and hers dressing rooms, a wet bar, an exercise room and a sauna. The house boasts two guest houses, Japanese gardens, a tennis court and a gym.
Not just any buyer can get a glimpse of the luxury mansion, however. Potential buyers must pre-qualify themselves by showing a financial statement or obtaining a banker’s recommendation.
Sellers don’t always get their price; thus far, the highest selling price for a house in La Jolla has been $4 million.
Most $1 million-plus houses have sold for about 80% of their original asking prices, said Marge Seifert, associate vice president of Willis M. Allen Co.
