Hot Property: 'Gossip Girl' executive producer lands in Hollywood Hills

 

"Gossip Girl" executive producer Bob Levy has purchased a Hollywood Hills-area home for $1,005,000.

The updated 1965 house has two bedrooms and 2 1/2 bathrooms in about 1,620 square feet. The two-story house previously sold for $759,000 in 2004. Asking price was $1,125,000. The listing agent was Crystal Heatherly of Deasy/Penner & Partners, Beverly Hills. Konstantine Valissarakos of Sotheby’s International Realty, Los Feliz, represented the buyer.

The 90068 ZIP Code had 13 single-family home sales in May at a median price of $670,000, down 34.8% from the same month in 2008, according to MDA DataQuick. That worked out to $542 per square foot.

-- Lauren Beale

Thoughts? Comments?

Photo: The listing described the house as a "modern reinterpretation" design by L.A.-based architect Chet Callahan. Credit: Brian Thomas Jones

Comments

[syscom3]

And why is this important?

Theres a person in my neighborhood who just bought a home for $400,000. And its 1200 sq ft on a 6000 ft lot.

Does that also qualify as news?

[Paul O]

Who cares? Quit posting these 'celebrity' home purchases (that is, if the executive producer of "Gossip Girl" can be considered a celebrity).

[swinla]

Since when do producers qualify as celebrities? I didn't move to California to worship the ground producers walk on. Please tag this correctly...

[DF]

I agree that the "Hot Property" feature is ill-conceived. The real estate market is crashing from the high to the low end throughout LA. There is no such thing as "hot property"--the range is ice-cold to lukewarm.

There is something interesting about this purchase, though, which is how overinflated the price of this sale still is. A house that sold at .75m in 2004 should rightly be valued around the same amount, if a bit lower. The market hadn't reached a peak then but was still well inflated past Case-Shiller and historical averages.

To pay a .25m premium _past_ that price, though, represents an astonishingly poor financial decision. (Unless the original price was for a shack that has since been transformed into a flawless showcase.) But hey, the producer of the Gossip Girl likely has enough money that he can throw away six figures worth of cash and never know it, so for him it's likely a moot point.

[Drew]

Please stop complaining to Lauren.

As she's posted, she is under a mandate from her employer to cover the celebrity real estate beat.

If you don't like it, talk to her editors. Perhaps if enough people let them know that tis type of "news" is not of interest to them, they'll change their focus.

Question to Lauren -- does the newspaper receive any kind of consideration for this coverage? I note that the name of the seller's and buyer's agents is always included in these writeups.

[LA-renter]

I think the prior posters make a good point, Lauren.

We need an official celebrity list. Otherwise, anyone with an agent and a fax machine will be getting undeserved free publicity here.

If you dilute celebrity too much, no one will be sending you these juicy posts.

[Lauren Beale]

Drew:
Regarding your question: Does the newspaper receive any kind of consideration for this coverage? Nope.
Lauren

[BrianW]

Apparently DF doesn't understand high end design. Or, more critically, doesn't understand that housing prices are more than a product of linear extrapolation. Clearly quality properties that are well done will fetch a premium. Average properties will not. And there probably isn't a liquid market for marginal properties.

[El Dabe Lawyer]

We have been commenting on this blog forever....we don't want "Hot Property" listings. But its obvious that Lauren Beale doesn't read this blog, and more importantly, she does not read this blog. She write her column, which is published elsewhere in the Times, and some online editor just copies and pastes it into this blog so they have content. I guess it is better than nothing, which is the alternative, since Viles is gone and no one can give us any good actual news or analysis.

[DF]

"Apparently DF doesn't understand high end design. Or, more critically, doesn't understand that housing prices are more than a product of linear extrapolation. Clearly quality properties that are well done will fetch a premium. Average properties will not. And there probably isn't a liquid market for marginal properties. "

Apparently BrianW doesn't understand basic English. If he had read my post more carefully, he would have seen that I explicitly stated that the increase in price might be justified if it reflected capital improvements (including, obviously, design elements).

Also, apparently BrianW doesn't understand the logical fallacy of reductio ad absurdum. Nothing in my post suggested that housing prices are always a product of linear extrapolation. They obviously aren't. But given that home prices in Los Angeles were overinflated by any rational measure in 2004, and that this buyer paid a third again the 2004 price for the house, strongly suggests that the buyer substantially overpaid.

The statement "properties that are well done will fetch a premium" is true, but only as compared to some rational baseline value.

[original thinker]

Billy Baldwin, The Dean of American Interior Decorators,
once said, "Nothing is interesting unless it is personal."
I'd love to meet the man reflected in this decor. I'm
sure he's not as deep as his pockets.

[BrianW]

DF. To imply that you can use 2004 as a baseline without knowing the circumstances of the sale is, by definition, to use linear extrapolation. A line, last time I checked, was made of two points. Your statement, "there is something interesting about this purchase, though, which is how overinflated the price of this sale still is." implies that the fact that a premium over the 2004 price was paid means a priori (yes, they offered grammar school latin on Vancouver island) that the price is, as you say, overinflated. I think you also used the phrase "astonishingly poor financial decision." My guess is that a May of 2009 sale would have been heavily vetted by the banks, who at that point were retrenching lending at an astonishing pace. So, if anything, a sale in May of 2009 suggests a bargain. Indeed, with the onset of massive quantitative easing, hard assets like property and commodities are likely to do well, as the real value of money declines. Indeed, in a world of 7 to 8% inflation, home values are likely to appreciate at 9 to 10%. So many Monday morning quarterbacks are obsessing over the last bubble. My suggestion for you, for an astonishingly smart financial decision, is to find the next bubble and invest in it. Just get out early. cheers.

[sheila]

my computer has this cool thing called a "mouse." it allows me to click on stories i want to read, and to scroll right by stories i don't. all of you complaining about having to suffer through reading then commenting on celebrity writeups in this blog should get one. it's great!

[DF]

BrianW,

Your original post suggested that I thought housing prices were _solely_ a function of linear extrapolation. In fact, my post merely used that as a baseline, and I absolutely believe it's a mighty useful one--at least as a starting point. It's a rough cut, but especially useful where, as here, there's an enormous disparity between historical averages and the price paid. That should at least raise serious reservations, even if they can be allayed by some other evidence.

The point about the banks doesn't convince me. Lenders are constrained by appraisals to some extent, but their primary benchmark for loans are the financials of the buyer--income, down payment, credit score. Plus, recent history shows banks aren't exactly sharp when it comes to gauging realistic real estate values. So I can't really see the logic of the argument that if a loan went through, the price must be solid.

We can agree to disagree about the wisdom of this purchase decision, but I feel pretty confident based on the available evidence that it's a major loser, at least in the short term. Of course, if the buyer plans to stay in the house for seven or ten years, he'll likely break even or so (though that will likely cash out to a loss when adjusted for inflation).

[firesale]

BrianW wrote:
"Indeed, in a world of 7 to 8% inflation, home values are likely to appreciate at 9 to 10%. So many Monday morning quarterbacks are obsessing over the last bubble. My suggestion for you, for an astonishingly smart financial decision, is to find the next bubble and invest in it."

Where did you get your inflation figures? In LA, the
rate of appreciateion was approx. 9x area annual inflation
for a period of 7 years ! My financial suggestion to
you, BrianW, is to wait until this dimple is as big as
your past bubble. Now, that would be "an astonishingly
smart financial decision."

Personally, I can't wait to wallow in the dimple.

[vulturecapital]

all of you complaining about having to suffer through reading then commenting on celebrity writeups in this blog should get one. it's great!

Posted by: sheila |

Shelia has any one ever told you that you are a master satirist? I relate so much to your post:

My friend and I went for drinks at the lovely Hotel Essex last week and we were shocked upon our entrance to find Mr. N. Horsely, right in the middle of the hotel lobby, getting intimate with a pig. Well, sure enough, my friend feigned outrage and wanted to tell Mr. Horsely what she thought of his very rude behavior, but I was quick to place her in check. "This sort of thing happens all the time in a capitalist society," I admonished. "If management condoned it, who are you to complain?"

So, I concur Sheila. If you don't like man-on-pig rutting in the middle of your haunts, then scroll right past it.