Los Angeles Trophy Homes in Huge Demand
August 26, 2013
Kristoffer Winters has put in two years of hard work in trying to renovate and rebuild his Art Deco mansion ‘The Reserve’ which has six bedrooms and 11 bathrooms with the interiors done right up to the monogrammed bathroom towels, as this is what prospective customer want. The price quoted by Winters for this luxurious trophy home is a whopping $25 million. Winters’ mansion is barely six minutes away from the Playboy Mansion and the gentleman that has bought it can literally throw a party the minute the funds hit the escrow account.
At present, LA has become a coveted destination for luxury home buyers from overseas with three popular US Zip codes that are all time hot favourites: West Hollywood’s 90069, Homes by Hills and Bel Air’s 90077 and Beverly Hills’ 90210. A lot of high end homes with the $20 million plus prices are coming back into the market as overseas buyers are eying these properties located in the land of movie stars and swimming pools. The sale of these homes has picked up in a big way since 2008 with a stronger economy that has forced the prices to rise sky high once again.
London is still at the number one spot when it comes to the purchase of spec homes with New York coming in as number two- however, Los Angeles is coming up with great potential as it is all set to attract international investors in the high-end property segment. The revival of luxury spec homes also has a major role in the growing popularity of LA coupled with the fact that the retail market does not have fresh projects in the offing and the existing properties are apparently the ones listed in the housing market.
The luxury trophy homes, forming a tiny fragment of the real estate market, have abnormally high asking prices that are unrealistic and that has led to them taking months or even years to sell. Buyers are interested in new homes, however due to less time on hand, they are unable to monitor the construction and interiors personally- hence, the demand for spec houses has increased. The average price of a high end home in LA has risen by 26.1% from last year. However, the only downside to trophy homes is that they can become risky investments as they have high maintenance costs and are not liquid assets. Nevertheless, Los Angeles attracts a lot of international buyers because of its glamor, landscapes and balmy climates which has increased the demand for spec homes.