Valley Real Estate Is Looking Like a Million Dollars
For years, only the loftiest reaches of the San Fernando Valley boasted million-dollar homes.
Not anymore.
Last year, 159 homes in the Valley sold for $1 million or more, up from 76 the year before, according to the Southland Regional Assn. of Realtors.
The price increases are being driven by even higher prices on the Westside, which real estate experts say make the Valley seem like a bargain. The region’s high-end market also is being powered by the strong economy and Wall Street’s bull market.
“This April was one of the best months I’ve seen in a long time,” said Stephanie Vitacco, an agent who has sold Valley real estate since 1988.
Agents completed 20 million-dollar sales in April, she said, and 12 others were underway. This year, 44 Valley homes were sold for $1 million or more through April, compared with 42 during the same time last year.
The boundaries of the San Fernando Valley’s million-dollar neighborhoods also are expanding. Once largely confined to the toniest areas of Studio City, Toluca Lake, Sherman Oaks and Encino, real estate brokers say there are million-dollar homes being sold in Calabasas, Chatsworth, Granada Hills, Northridge, West Hills and Woodland Hills.
“The luxury home market has grown tremendously in the Valley,” said Jim Pascucci, an Encino agent. “In 1978, there were maybe a dozen bona fide million-dollar-plus homes in the Valley, at places like Lake Encino, the Clark Gable Estates in Encino, and certain choice homes in Toluca Lake or Studio City.”
Housing in all price ranges has continued to climb since the real estate collapse of the early 1990s. In May, prices for single-family homes in the Valley were up 17% compared to the same month last year.
The Valley’s median resale price in May reached $220,000, meaning half the homes sold for more and half for less. The median price for Valley homes at the peak of the real estate market in 1989 was $245,000.
The stock market has helped fuel some of the sales.
“A lot of people who have made a lot of money in the stock market in the past few years are taking some of it out and investing it in real estate. There are a lot of new millionaires,” said Nidal Ibrahim, a spokesman for Newport Beach-based Capital Pacific Holdings Inc., builders of the Mulholland Park development in Tarzana, overlooking Braemar Country Club.
The Valley isn’t alone. A record 5,121 homes priced at $1 million or more were sold in California last year, up 37% from 1997, according to Acxiom / DataQuick Information Services, a La Jolla real estate research firm.
The 1998 total was 20% higher than the previous record, which was set in 1989.
In the Los Angeles area, “A million dollars just won’t buy what it used to,” said Bob Bray, an analyst in Santa Monica with the Meyers Group, a real estate consulting firm. “L.A. is in a league of its own, except for maybe the Bay Area, for what you get in terms of lot size and home size.”
To many luxury buyers, $1-million homes in the Valley are a bargain compared to what they would get for the same money at the beach or in Beverly Hills and Brentwood.
“You can easily spend $700,000 or $800,000 for 1,800 square feet on the Westside,” Vitacco said.
By contrast, she said, $1 million is likely to buy 4,000 to 6,000 square feet of house--and a larger lot--in the Valley.
Pascucci said the “high prices on the Westside help the million-dollar-plus market in the Valley because, obviously, you get a lot more for your money.”
He added, “We have a lot of people who start out looking on the Westside and end up buying over here.”
The Valley even has a few of its first “tear-downs.” These are expensive homes that buyers tear down to build even more expensive homes, a practice common in high-end neighborhoods.
In the past, virtually all million-dollar homes were built on custom lots. But $1-million tract homes have become commonplace in recent years at developments such as Mulholland Park and Mountain View Estates in Calabasas.
Mulholland Park, for example, is selling 6,300-square-foot homes in the million-dollar range.
“The builders are being smart,” Vitacco said. “They’re giving the buyers everything they want in gated communities with all the amenities and terrific upgrades. These are quality homes. It’s just that instead of building one, they’re building 50.”
Calabasas was the hot spot during April, according to Vitacco, accounting for 22 of the 32 million-dollar homes that either sold or went into escrow. Calabasas has at least seven or eight housing developments in the million-dollar range.
Vitacco said the average time on the market for a million-dollar home is 30 days or less. “There are more buyers out there than inventory, even in this price range,” she said.
That doesn’t mean the rich are willing to squander their money.
“People with money are still prudent,” said Pascucci. “They shop like anyone else and look at a number of homes before they make their decision. I just sold a home for $1.3 million to some buyers who probably looked at 30 houses.”
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Million-Dollar Homes
In the San Fernando Valley sales of homes for $1 million or more have risen sharply in the last year.
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Estate brokers say their clients demand more effort--and patience. B6
* Adding the right touches can push home’s selling price over $1 million. B6
