AT HOME : Dana Point: Fishing Village to City : Despite rapid growth, smog-free beach city retains its small-town character.

When author Doris Walker moved to Dana Point in 1963, the 6,000 residents didn’t fully appreciate the sweeping ocean vistas that spread out before them. “There was so much open land at the time, nobody really noticed the view before,” she said.

A quarter-century of development gradually changed that perception. To their dismay, residents found their fine natural harbor harder to spot behind a growing number of homes, small apartment buildings and hotels.

Worse yet, as developers snatched up more and more prime waterfront parcels--and even diverted Pacific Coast Highway inland at one place--access to the beach became more difficult.

Controlling growth became a priority, and it was on the minds of local people last year, when they voted to incorporate after a 27-year struggle. The new city of Dana Point began operations on Jan. 1, and development issues have topped the agenda since then.

“The City Council told developers that it wants cautious, quality growth,” said Tom Brabeck, a Minnesota native who settled in Dana Point in 1969 after a stint in the Navy.

Stopped Hotel Building

Brabeck bought a hillside lot for $15,000 in 1972 and spent $50,000 in 1976 building a 2,300-square-foot English Tudor-style home. He estimates it is worth $450,000 today.

Already, the city has stopped the construction of two view-blocking hotels that would have overlooked the harbor, he said.

Today, the incorporated city numbers 26,000 residents and includes three distinct communities--Dana Point proper, Capistrano Beach to the south and Monarch Beach to the north.

The status of Monarch Beach hasn’t been resolved, however. Neighboring Laguna Niguel, which holds its own incorporation vote Nov. 7, claims the area too, and has gone to court over the issue. The contested strip of coastline includes some of the most expensive homes in south Orange County, as well as the opulent Ritz-Carlton Hotel and its considerable tax base.

According to Brabeck, an associate broker at Roberts Real Estate, the city offers housing in a wide price range.

Wide Range in Prices

At the low end of the market, buyers can find single-family homes in the Village or Dana Knolls area, near San Juan Capistrano, starting at around $250,000. For that money, a purchaser might get a 25-year-old, two-bedroom, two-bath house with 1,500 square feet. By contrast, some of the more expensive houses in Monarch Beach run into the millions of dollars.

Condos range in price up to about $685,000, Brabeck added. That sum would buy a 2,500-square-foot home on the cliffs above the harbor, with panoramic views of the ocean from every room.

As a less-expensive alternative, Brabeck says a 1,200-square-foot Monarch Beach condo within 150 yards of the beach recently sold for $230,000. The median price for the city, including condos, approximates $350,000.

In a way, it’s ironic that the new city took so long to get established, because the area has a long, colorful past.

Early in the 1800s, Russian ships hunted for sea otter in the nearby kelp beds. Starting in the 1820s, New England merchant vessels anchored in Dana Cove to trade manufactured goods for cattle hides produced at nearby Mission San Juan Capistrano and surrounding ranches.

Yankee Trader History

The area was named after Richard Henry Dana, a Bostonian who visited in 1835 aboard one of these Yankee traders and described the shoreline with admiration in his book “Two Years Before the Mast.”

But a permanent settlement was slow in coming to Dana Point. Poor roads and an unreliable fresh-water supply discouraged people from moving in, notes Walker in “Dana Point Harbor/Capistrano Bay: Home Port for Romance,” an illustrated history.

According to Walker, the area got a railroad link in 1887, and that spurred several attempts over the next half-century to build residential subdivisions. In spite of a continuing lack of good roads, periodic economic depressions and other problems, a small town started to form on the hills overlooking the cove.

But progress was slow. “During the ‘30s, hardly anyone was living in Dana Point--just a few scattered fishermen and real estate people,” recalled Lorrin (Whitey) Harrison, who was born in Garden Grove in 1913 and first moved to Dana Point in 1936.

Most of the handful of houses that had been built during the ‘20s were for rent during the Depression, Harrison explained, because “nobody could afford to buy anything.” At the time, he and his family leased a modest house in Dana Point for $10 a month.

Abalone Diver

Harrison later moved away from Dana Point for a while, then returned in the mid-’40s. He spent much of those early days surfing on 110-pound redwood boards in Dana Cove in the years before the harbor was built. He also worked for more than three decades as a commercial diver for abalone, selling his catch to restaurants up and down the coast.

“I’ve spent a lifetime on the water,” he said.

Development picked up in the postwar years, helped by completion of the San Diego Freeway through San Juan Capistrano in 1959. Seven years later, construction of the 2,500-boat marina began. “The harbor was definitely a spur to growth. It gave the area a personality,” Walker said.

It also brought boat owners, shops, hotels, tourist dollars, new residents and, for the first time, crowding.

Today, on weekends during the summer, traffic backs up on Pacific Coast Highway and parking gets tight at the harbor. But the increased congestion isn’t attributable solely to tourists.

Traffic Problem

Kelly Todd, who first came to Dana Point in 1983 with her husband, Tim, estimates rush-hour traffic on Pacific Coast Highway has increased 30% since 1986.

“The city’s growing too fast, but obviously, this isn’t a problem unique to Dana Point,” she said. Even so, Tim Todd suggests, more bike paths and tricycle taxicabs could help ease the automobile congestion around the harbor and beach areas.

Greg Heneghan, a college student and bartender who came to Dana Point in 1967 with his parents from New York City, worries about the ecological damage to the local coastline brought by growth.

Heneghan surfs, swims, canoes and skin dives, and he’s concerned about occasional raw sewage spills, pollution and soil runoff caused by the new housing developments in the hills. “Dana Harbor is still cleaner than Newport Bay,” he conceded. “But I’d like to see more respect for the ocean.”

Dana Point, along with Costa Mesa, Laguna Beach and other Southland cities, also has had some problems with illegal aliens and other day laborers gathering on street corners in search of work. The City Council in August banned workers from congregating on Dana Point streets but at the same time set up a telephone bank to put laborers in contact with employers.

Smog-Free Summers

Despite these difficulties, residents generally speak favorably of their city. The Todds say Dana Point retains a small-town flavor, where people know their neighbors. And they rave about the ocean breezes that keep the area cool and smog-free throughout the summer.

The Todds, originally from the San Gabriel Valley, bought a vacant lot in the Village, one of the older neighborhoods of Dana Point, where they built their three-bedroom, two-bath house, which they finished in 1988. They never bothered to install air conditioning. “You don’t need it,” said Tim Todd, a contractor.

He estimates that the ocean-view, 2,350-square-foot house is worth $400,000.

Ray Lemire believes Dana Point offers some of the best rental values in south Orange County. He and his girlfriend pay $900 a month for a two-bedroom apartment in the Village area. They have a large outside deck with an ocean view, and a two-car garage.

“Rents are a lot less expensive than in Laguna and traffic flows more smoothly,” said Lemire, a Maine native who installs residential water-treatment units.

East Coast Owner

Some of the older neighborhoods border on the seedy, he said, although he hasn’t experienced any problems with crime.

Don Kalil regards Dana Point so highly that he talked other members of his immediate family into buying a 2,000-square-foot condo near the harbor for use as a second home.

That might not seem so special, except that the Kalils live in Wilmington, Del., where they run Compu-Val Investments, a money-management firm.

Don Kalil gets out to California frequently on business, and he looks forward to these visits. He calls Dana Point a small, friendly town, with plenty to see and do within walking distance or a short drive from the condo. The family also looked for homes in Newport Beach and Laguna Beach but found Dana Point to be less congested and more affordable.

After a heady price spiral last year, the housing market in Dana Point has softened this year, with about four times more homes currently offered for sale, Brabeck says. He foresees a period of more modest price increases following the inflationary burst in ’88.

Hope for Control

Most of the new construction is occurring in Monarch Beach and Dana Point, in the hills north of Selva Road. Local folks might not like the bulldozers, increased traffic and crowded beaches, but the days of the quiet fishing village are gone.

“It’s foolish to think we’d have the same terrain as in the ‘60s,” said Walker.

Even so, she and other residents hope the new city government can keep the reins on development. She looks optimistically toward the future, encouraged by a master plan for Dana Point and the vigilance of the California Coastal Commission, which since the early ‘70s has cast a wary eye on beachfront development.

Walker, originally from Ohio, still lives in the house she moved into 26 years ago. She has watched the area around her get built up and the yards grow smaller. But through all the construction, Walker has managed to retain a partial ocean view, which she calls her private corridor to the sea.

“And I treasure it now more than ever,” she said.

AT A GLANCE Population 1989 estimate: 22,644 1980-89 change: +28.7% Median age: 33.9 years Racial/ethnic mix White (non-Latino): 82.4% Latino: 14.1% Other: 3.0% Black: 0.5% Annual income Per capita: $20,222 Median household: $40,268 Household distribution Less than $15,000: 16.6% $15,000 - $30,000: 20.0% $30,000 - $50,000: 25.3% $50,000 - $75,000: 20.4% $75,000: + 17.6% Note: Demographics for Monarch Beach area of Dana Point not available.