In the wake of the devastating Eaton fire that razed over 6,000 homes in Altadena, many residents are grappling with the choice of selling their fire-damaged properties rather than opting to rebuild.
The local real estate market has seen a noticeable softening, with declining prices and slowing sales, according to interviews and statistical data.
Real estate agents and market observers indicate a growing inventory of properties listed for sale, which has led to a decrease in closed transactions.
Teresa Fuller, a local real estate agent, shared insights into the evolving situation, noting, “January was filled with devastation, February saw a trickle of listings, and by March, dozens of lots hit the market, with most selling quickly.”
However, the landscape has changed. Fuller reported a surge in the number of lots available, accompanied by a sharp reduction in sales activity, leading to a downturn in the absorption rate of properties.
In one week alone in July, 29 new lots were listed, yet only four found buyers.
The emotional toll is significant for homeowners. Fuller recounted a couple’s heartbreaking realization that the market value of their property had dropped substantially — from an estimated $905,000 in March to just $730,000 when they were ready to list. “This is all we have to move on,” the homeowner said through tears.
Another lot, initially priced at $1.295 million, saw its value plummet to $795,000, evidencing the reality faced by many sellers.
An analysis of the Altadena Multiple Listing Service data revealed a stark shift. The ratio of active listings compared to pending sales has dramatically increased, from roughly one-to-one in mid-March to an alarming ten-to-one by July.
The inventory of active listings has quadrupled within this time frame, while the number of weekly sales has dwindled to approximately ten, highlighting an over-saturated market.
Despite these current challenges, some believe the long-term outlook for the Altadena market remains positive.
Southern California has long struggled with a housing shortage, and many still view Altadena as a desirable area for both living and development.
In a surprising turn, Black Lion Properties, a limited liability company, has emerged as a significant player in the local real estate scene. Managed by brothers Jesse and Edwin Castro, Edwin recently won a $2-billion Powerball lottery jackpot, and he has used his winnings to purchase over a dozen lots affected by the Eaton fire.
A spokesperson for Black Lion asserted that the Castro brothers are committed to the Altadena community and see their investments as an opportunity to assist homeowners while preserving the unique character of the neighborhood.
Currently, Black Lion Properties stands as the second-largest buyer of lots in Altadena since the fire, trailing only behind real estate developer Ocean Development.
The Castro family aims to utilize many of the purchased lots for their own use, while others will feature new home designs in accordance with existing plans.
Local real estate agent Ramiro Rivas anticipates that as more lots become available, larger real estate firms will enter the market, potentially shifting the dynamics even further.
“There will be bigger players coming in on a larger scale,” Rivas commented, regarding the influx of developers like Black Lion Properties.
As the community continues to grapple with the aftermath of the fire, many individual homeowners are faced with painful decisions.
Art Davis, known affectionately as the ‘mayor of his street,’ initially held hopes of rebuilding his lost home. However, mounting obstacles soon emerged.
Davis, 82, and his wife Mary initially struggled to secure a rental during the rebuilding process, encountering stiff competition for available options.
After relocating to a rental unit in South Pasadena, Davis and his family began discussing rebuilding timelines with builders, only to realize that the estimated wait could span two years.
Compounding their struggles, their landlord later informed them that they would need to vacate the rental at the end of the year.
Davis eventually had to confront the reality that, with the delay in rebuilding, the only feasible option was to sell their lot, a painful realization that distressed both him and his family.
“I saw it dawning on him, this dream of being back in this place fading away,” said Davis’ daughter, Gina Gurewitz.
This sentiment echoes the feelings of many families in Altadena, who are navigating similar dilemmas.
As inventory levels increase and the market becomes more competitive, prices have begun to drop accordingly.
Rivas noted that prior to the fires, lots were selling for an average of $72 per square foot; however, current listings hover around $69, signaling a decrease of around $21,000 for a typical 7,000-square-foot lot.
He acknowledged that multiple property owners are inquiring about selling, as many are reassessing the costs involved in rebuilding.
Some homeowners are discovering that their insurance policies do not cover full rebuilding costs, further complicating their situations.
Amid the pressure to sell, Gurewitz has observed a shift in the social dynamics surrounding rebuilding versus selling.
Previously, there was an unspoken stigma against selling, with neighbors expressing disappointment over others’ decisions to leave. Now, however, the conversation has shifted, and many are more open to discussing the possibility of selling their lots.
Gurewitz remarked, “In public, they would say they were going to rebuild, but in private, many were uncertain.”
Even staunch advocates for rebuilding have begun to reconsider their positions, reflecting the shift in community sentiment.
As her parents navigate their challenging situation, they face a housing market that is equally daunting elsewhere.
Gurewitz emphasized the emotional toll of such upheaval at this stage of life, stating, “To have this happen at this stage in their lives is just so disruptive. The goal now is to get them into a place where they can just be and feel safe.”
image source from：latimes
