In a recent article in the Los Angeles Times it was reported that the downturn in real estate values has finally hit the Westside.
Statistics cited from a DataQuick Information Systems report indicated year-over-year sales prices in the month of April showed a decrease of 12.8% in ZIP Code 90210 (Beverly Hills) and 11.3 percent in 90049 (Brentwood).
Upscale communities all across the country are being affected by the downturn in prices, according to the article. Many local real estate agents have maintained that prices across the Westside might not fall because prospective sellers here don’t face the same kind of economic pressures as people living in less-affluent areas. Therefore they can sit back and ride out the storm.
According to the story, Westside mansions are now being compared by buyers to home values they can find in less expensive areas, so, relatively speaking, the Westside now seems overpriced.
A real estate agent sitting in an open house for several weeks said things were still good but that it was taking longer to sell homes these days. Buyers are very price-conscious, she said, and were looking for bargains, waiting for prices to drop. Moreover, given the problems in the mortgage arena, lenders are tightening up standards and it’s not as easy for buyers to qualify as it was before.
With the return of good weather and the ending of the school year, it appears there are more “open house†signs out on Sunday afternoons. This could put further pressure on prices.
One Beverly Hills realtor quoted in the LA Times story, Michael Libow, recently made a sale after he got his client to reduce the selling price from $12 million to $9.995 million. According to Libow,10 million is something of a “psychological break point.â€
That said, $9.995 million is still a lot and clearly prices today remain far above where they were five or 10 years ago.
