Californian luxury house prices take upward turn
05 December 2011 16:02
Home values in Los Angeles rose by 2.5% year-on-year in the third quarter of this year according to a new index released this week by First Republic Bank.
The average price of a luxury home in Los Angeles is currently $2.01 million and prices are up in Los Angeles, San Diego and San Francisco as California starts to emerge from the downturn.
Los Angeles area values rose 0.7% versus Q2 2011 and increased 2.5% on the third quarter of 2010 and average home prices in the Los Angeles area have grown in three of the past four quarters.
Luxury homes values are the most robust, according to local agents.
"For homes priced at $5 million and up, the market remains active," Jane Brill Graven of Coldwell Banker Beverly Hills East told OPP.
"There are well-qualified buyers who are looking for properties at the very top end, and they have the upper hand. Owners are having to reduce prices to where the market is."
"If we had more and better product, we would have had more transactions in the past 12 months," said Barry Host of South Bay Brokers in Manhattan Beach. "Buyers with money are out there, but there is also a lot of uncertainty. Unless the news starts to settle, the market will continue to bump along."
San Diego area values increased 1.1% on Q2 but fell 3.9% year-on-year. The average luxury home in San Diego is now $1.63 million, according to the index. And prices in the San Francisco Bay Area climbed 1% on Q2 but dropped 1.4% year-on-year.
"Luxury home prices in many California communities increased due to low inventories, low interest rates and home prices that have declined over the past few years. This has improved the economics of investing in residential real estate,'' Katherine August-deWilde, president and chief operating officer of First Republic Bank, told OPP.
"All three major metropolitan areas in California experienced gains in home prices in the third quarter, which is the first time that has occurred since the fourth quarter of 2010,'' she said.
The First Republic Prestige Home Index measures changes in homes valued at more than $1 million in key California urban markets including the Los Angeles districts of Arcadia, Beverly Hills, Calabasas, La Canada Flintridge, Encino, Los Angeles, Malibu, Marina del Rey, North Hollywood, Pacific Palisades, Pasadena, Playa del Rey, Santa Monica, Studio City, Bel Air, Brentwood and Westwood as well as major centres such as San Francisco and San Diego.
Californian luxury house prices take upward turn.
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