Investors are buying up the first scorched lots to hit the market after wildfires devastated Los Angeles in January, paying the same or even more than the land was worth before the deadly blazes.
Four separate fires raged across Los Angeles for about two weeks, killing 29 people and destroying more than 16,200 homes and other structures before they were finally contained in late January, CNN reported.
About 80 listings for empty land in Palisades and Altadena have hit the market since mid-February, and real estate agents originally worried they would go for about half their pre-fire value, Wall Street Journal reported.
Instead, the properties are being bought by small and medium-sized investors who are paying the same or even above the land’s pre-fire valuation, according to the paper. The land is typically calculated as 40 to 60 percent of the property’s overall value.
In Altadena, the first four lots sold for $69 per square foot on average, more than three times the average of $22 per square foot in 2023-24, the paper reported. Local real-estate agents are aiming even higher, for $99 per square foot.
In the Palisades, prices are up 10 percent since the fire, and that’s before the neighborhoods have been rebuilt or fireproofed. Many of the buyers are paying all cash and are hoping to flip damaged homes or rebuild entirely.
The prices are a relief to sellers, some of whom are being forced out because they can’t afford both temporary housing and their pre-existing mortgages, and to residents who were worried the areas wouldn’t remain desirable, the Journal reported.
But the turnover is also raising concerns about predatory investors, and residents are worried the character and demographics of their neighborhoods could change.
Altadena in particular became a haven for Black families in the 1960s and ‘70s, leading to record-high home ownership rates among its Black residents.
Residents have put up yard signs, organized protests and raised funds for uninsured residents as part of a campaign called “Altadena Not for Sale.”
