Luxury market still red hot

While the rest of Southern California is being buffeted by the Santa Ana winds of the housing downturn, the luxury end of the market is blissfully humming along.

Sorry for the turgidly mixed metaphors. But I just received the latest sales numbers for the Westside and it appears that sales of multimillion-dollar homes are outpacing last year's stats by a tad.

Year to date, 206 sales closed at $5 million or more, compared to 211 for all of 2006. What's more, 50 of those sales were for more than $10 million, the same as for all of last year.

So far, the biggest sale this year was to actor Tom Cruise, who paid $35 million for a Beverly Hills estate last spring. Joining him in the cavalcade of multi-multimillion-dollar deals this year was Jeff Bezos of Amazon.com and, if you haven't heard, the Beckhams, who paid about $22 million for the former mansion of Northrop Grumman chief Kent Kresa, according to county records.

"Looks like the sub-prime debacle has not hurt the high end yet," says Cecelia Kennelly-Waeschle, a Sotheby's International Realty agent in Malibu, who is the keeper of "the list."

For the last decade or so, Kennelly-Waeschle has been keeping track of high-end sales stretching from Bel-Air to Malibu to Marina del Rey. Her list is often more thorough than what's available from DataQuick Information Systems, because she can get her Realtor buddies to reveal the sales prices on deals that they successfully keep out of the public record.

A couple of the latest transactions included one for $27 million in the exclusive gated community of Beverly Park and four deals in the double-digit millions in Brentwood Country Estates, the area's other exclusive gated community. Also, the late Johnny Carson's estate in Malibu sold earlier this year for a cool $33 million.

But these deals would pale in comparison to a couple of current listings that are striving for the mantle of biggest residential deal in U.S. history. The big Hot Property news this year was the listing of the former Hearst mansion at $165 million (pictured above) by the brokerage Westside Estate Agency. The 6.5-acre compound known as Beverly House was featured in the famous horse head scene from "The Godfather."

And then there's Fleur de Lys, the Holmby Hills estate as ornate as its name on sale for a mere $125 million. Coldwell Banker top producer Joyce Rey and Windermere Properties agent Robert Kass shared the listing.

Word has it that there's been at least a dozen showings, which is saying something because no one gets in the front door without proof they have the means to buy it.

-- Posted by guest blogger Annette Haddad

Photo credit: Westside Estate Agency

Comments

[Inland Empire]

Maybe they can find a buyer for Jackson's Neverland Ranch which they say is in foreclosure?

[MyLessThanPrimeBeef]

This is how the world works.

First you lay off the rank and file workers whose middle class homes are then foreclosed on.

Then, you report a $10 billion loss.

After that, the board fires you and you have to sell your $50 million luxury home.

[Kaye Thomas]

There is a lot of money in the LA area.. far more then most people realize. Once you get above a certain price range you buy property based on what "you want"... not what the latest media headline says.

[BetterVillage]

"...she can get her Realtor buddies to reveal the sales prices on deals that they successfully keep out of the public record."

Names are protected behind entities, but how does one keep sales prices out of the public record legally?

[Annette]

This is from Annette Haddad, the poster of this blog item:
In response to BetterVillage's query "...but how does one keep sales prices out of the public record legally?"

Forms are available at the Los Angeles and Orange counties recorders offices that allow buyers to request that the amount of the transfer tax not be shown on the original document.

The county will list the sale price as $0 and places the documentary transfer tax amount on the back of the deed or on a separate form attached to the deed. The deed is then stamped "Not for Public Record."

The transfer tax is computed on the full value of the property conveyed, so one can figure the sales prices by knowing the tax amount. But even if sellers take such steps, members of the public can ususually find out what a property sold for by physically inspecting the property records at the county recorders office.

In addition, some local Multiple-Listing Services charge a "confidentiality fee" that allows brokers to keep a sales price off the MLS. But in this case, the property's sales price will eventually be entered into the county assessor's rolls and available to the public.

[Michael Snyder]

Less than prime, you got the first two parts right,
First you lay off the rank and file workers whose middle class homes are then foreclosed on.
Then, you report a $10 billion loss.
But then the board gives you a $150 million pay-cheque on your way out the door.
You sell your $50 million beach home so you can upgrade to a $80 million home in Carmel.

[producer 08]

You are off by a year:

I bet that by next year sales will be off and prices will be down 30% in the luxury markets, also I was an agent in that area and as of 3 months ago most of the agents in BH, Hollywood Hills, Bel Air, Holmby Hills are out of a job.

Sothebys and Coldwell have either closed their offices or laid off many of their agents. I was one of them !!!!!!!!

CNN: November 8 2007

"Worst real estate slump in decades."

[Pat]

How do you get laid off when you are not really an employee? I thought real estate agents were independent contractors

[David]

I personally don't have to be concerned about the price fluctuations on $5M+ homes. If this is something that concerns you, that's a very nice problem to have.

[dusting off Springfield]

I don't want your lonely mansion with a tear in every room.

[BetterVillage]

Annette, if I understand correctly, this would mean that the stats for sales prices could be well off the mark, right, if they use recorded information that excludes sales prices. It might not be statistically meaningfull to include this in a macro look at prices, but it would certainly be usefull to understand what's happening from market to market.

Also, how in the world could anyone audit the property taxes being paid on such properties... Probably no one is going through paper piece by piece at the recorder's office to make sure that taxes are being assessed correctly.

[tony almonte]

better village.....its a snap. the assessor has a web-site that you can access, then dump in the address of the home you want to see.
way too easy.

[producer 08]

tony almonte what are you talking about with better village ?

[BetterVillage]

Tony: we're talking about more expensive homes that might not show a sales price due to someone having filled out a form, and the legality of excluding information that usually shows up in the public record.

[producer 08]

how do you access it on your site better village ?

[BetterVillage]

Producer: I don't link to any of the assessor data. You can go to http://assessormap.co.la.ca.us/mapping/viewer.asp if that's what you mean.

[Town Crier]

Real estate companies are closing offices and firing agents. Agents are independent contractors, but the agency has the right to let an agent go without cause and at anytime. Prudential just closed their Hancock Park office and Coldwell Banker is closing one of their Beverly Hills offices. Time for real estate agents to back to real work

[MyLessThanPrimeBeef]

Michael Snyder, you're right.

The rich always say, 'Let the proletarian Angelenos eat cake!'

[Cal]

Unless you are the .1% of buyers (it used to be a smaller percentage, its just fewers homes are selling) in this market is the vagaries of this market really news?