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‘Hangover House’ sold to new owner

A new owner plans to preserve the iconic “Hangover House” in South Laguna Beach, built by adventurer Richard Halliburton in the 1930s.

Realty agent Fred James of Laguna Beach brokered the sale of the property, which he owned, having obtained it out of bankruptcy, along with 13 other properties, from the late Zolita Scott’s estate.

A Laguna local bought the 2,2000-square-foot house for $2.4 million, about half the original asking price, and an adjacent 8,000-square-foot lot for $800,000, James said.

Four other lots that adjoin the ocean-view Ceanothus Street parcel had been sold by the bankruptcy trustee handling the Scott estate.


The owner has plans to renovate the Halliburton House, which needs new plumbing and other fixtures, but keep the historic nature of the property intact, James said.

A new, 2,000-square-foot home is planned for the adjacent lot, with a pool between the structures.

“I am extremely happy with the buyer,” James said. In the six months that it took to sell the property, “I showed it to some people who wanted to tear it down and build a new house, and others who wanted to keep it exactly as it is. This [owner] is a good match and this was a fair price.”

James estimated it will take $500,000 to renovate and modernize the home.


The house is built of cement and appears solid, but steel rebar inside it has rusted and needs repair, he said.

William Alexander Levy designed the house, which Halliburton lived in briefly. A world-renowned adventurer and travel writer, he died in 1939 while searching for his friend, Amelia Earhart. His Chinese junk, the Sea Dragon, was lost during a typhoon.

"[The house] has ocean views, white water views, Catalina views, [Aliso Creek] golf course views and snow-capped mountain views of the Saddlebacks in the winter,” James said.

He said that when news came out that he had obtained the property and was showing it, an 86-year-old Laguna Beach woman called to say she would like a tour of the iconic house.

“She had grown up in Laguna Beach and always remembered it as the only house up on the hill,” he said. “But she had never been inside.”

He granted her request.

Many of the properties owned by Scott, who filed for bankruptcy protection before she died in 2010, were distressed or dilapidated, according to James. The Scott family had lived in the Halliburton house since the 1940s, having bought it for $9,000 from Halliburton’s family after his death.

James said he had lent Scott $6.5 million several years before her bankruptcy filing in order to buy a property in Dana Point. She put up 13 properties, including the Hangover House, as collateral on the loan. When the real estate market collapsed and she was unable to pay on the loan, she filed for bankruptcy to keep the properties from reverting to James in foreclosure.


He said it took four years of litigation for his company to obtain title to the properties Scott owned. Scott, a well-known Laguna Beach realty agent, died in 2010 at the age of 61.

“We probably won’t get our money back,” James said, due to the continued slump in the real estate market.

Twitter: @CindyFrazier1