There’s little doubt among real estate professionals and casual observers that the 2013 luxury home market provided sellers with continued relief from the lean years of the Great Recession.
Luxury homes sales started to resurge in late 2012 and continued through 2013, triggered by low interest rates, limited inventory and increased buyer demand.
“This is an incredibly elastic marketplace,” said Mike Shapiro, chairman of Newport Beach-based HÔM Sotheby’s International.
“There is a science to it that involves interest rates, taxes, the costs of building or renovation … but it comes down to the amount people (who) are willing to spend on a house.”
According to a TELESintelligence annual market report, the median home sale price in Crystal Cove rose 24.6% and rose 27.8% in Newport Coast.
The numbers gratify sellers, but Shapiro puts the large increases in perspective.
“The real high point of luxury market prices along the coast was in 2006-2007,” he said. “The percentage gains we saw in 2013 were gains on the lowest value of the home from 2008 to 2011.”
Luxury home prices dropped 30% to 40% during the Great Recession, Shapiro said.
He said he believes the Orange County marketplace will return to that high point by 2016 or 2017.
The very distressed properties—short sales, foreclosures and real-estate-owned properties—are mostly gone, leaving an inventory of normally priced homes, he said.
Inventory stabilization will reduce the growth of home prices, leading to smaller price percentage gains this year. Shapiro predicts a price percentage gain of 10% to 20% in the luxury segment, which generally encompasses homes priced at more than $4 million.
“All the segments of the luxury market are healthy and growing,” Shapiro said.
Exterior Steals Show
Seven bedrooms and nine baths help make the Italian-inspired estate at 31540 Peppertree in San Juan Capistrano a standout in the area, but its grounds add the stop-and-stare factor.
The 5-acre property includes a tennis court, 160-yard golf course and green, a fruit orchard, a private lake with a waterfall, and a rock-lined pool with a hidden grotto.
The home changed hands on Dec. 16 for $7.2 million, down from its Dec. 1 asking price of $8.8 million.
The estate is 10,500 square feet and was purchased completely furnished. It offers an indoor/outdoor koi pond. The ground-level master suite has ocean views and a private garden area. Children’s en suite rooms with hand-painted murals adjoin it. The upstairs office has custom mahogany bookcases, a marble fireplace and a balcony that offers views to the ocean.
The home was designed to be feng shui-compliant.
Suzi Dailey of Berkshire Hathaway HomeServices represented the buyer and the seller. The home was initially offered in June for $9.8 million.
Home Fit for the Royals
The home at 3111 Gardenia Lane in Yorba Linda is described as “majestic” by listing agent Alex Horowitz of Coldwell Banker Excellence.
It offers seven bathrooms, eight baths and 7,000 square feet of living space and sits on a 17,751-square-foot lot. It sold on Dec. 2 for $2.5 million, under its August asking price of $2.7 million.
Custom double doors open to a grand foyer, complete with dual wrapping staircases and a chandelier. The gourmet kitchen features a large island workspace and GE Monogram and Sub Zero appliances. Each upstairs bedroom has a full bathroom and a walk-in closet. The yard, professionally manicured, centers on a pebble-tech saltwater pool featuring a rock slide, Jacuzzi and customizable LED lights.
Alex Horowitz represented the seller in the transaction, and Chun Hui Grama of IRN Realty represented the buyer.
