Posted on 07/01/2025 3:17:48 PM PDT by Angelino97
Home prices in areas surrounding Los Angeles' devastating early 2025 wildfires have defied expectations, rising 4% year-over-year in the immediate aftermath of the disasters, according to a new analysis by PropertyShark.
The counterintuitive market behavior suggests that proximity to burn zones has not deterred buyers from high-demand neighborhoods, with some areas seeing dramatic price increases even as memories of the fires remain fresh.
Properties within three miles of the nine largest fires reached a median sale price of $1.33 million between February and April, well above Los Angeles County's $900,000 median. The 4% price growth near fire perimeters also slightly outpaced the county's overall 3% gain during the same period.
The Palisades Fire area exemplified this trend most dramatically. Despite being classified by CalFire as one of the top three most devastating fires in California history, homes within three miles of the Palisades burn zone saw median prices jump 15% to $2.13 million.
"Despite natural disaster risks, areas near burn zones remain desirable for buyers," the PropertyShark analysis concluded.
The Palisades area's resilience was particularly striking given the fire's destruction. Single-family home sales in the three-mile radius around the Palisades Fire increased 23% year-over-year, while median prices for those homes surged 26%. Condo prices in the area also climbed 23%.
Market performance varied significantly across different fire zones, however. While some areas like Sepulveda saw the highest increases — with prices jumping 24% to $3.1 million and sales rising 20% — others experienced sharp declines.
Areas near the Hughes Fire saw the steepest drops, with home prices falling 8% and sales plummeting 23%. The contrast highlights how local factors and neighborhood desirability continue to drive real estate outcomes even in disaster-affected areas.
The sustained buyer interest surprised analysts, particularly given the scale of destruction from fires like Palisades and Eaton, which together destroyed around 6,000 homes and contributed to real estate losses estimated to exceed $30 billion.
Sales activity near fire zones remained nearly unchanged overall, with transactions inching up just 1% to 2,167 sales between February and April. These fire-adjacent sales represented 17% of all home transactions across Los Angeles County during that period.
The data suggests that affluent communities proved most resilient to fire proximity concerns. Areas around the Sepulveda Fire, where median prices reached $3.1 million, saw particularly strong demand despite the recent devastation.
Single-family homes and condos drove much of the price appreciation near fire zones, with values rising 7% and 6% respectively. However, two- to four-family homes saw prices decline 6%, indicating varied impacts across property types.
The Eaton Fire area, despite being among the most destructive blazes, showed mixed results. While overall sales dipped 7%, median prices still managed a modest 2% increase to $1.27 million. Single-family home prices in the area rose 8% to $1.51 million, even as sales of those properties fell 10%.
Not all fire-affected areas saw positive trends. Beyond Hughes, areas near the Archer Fire experienced both declining sales (down 14%) and falling prices (down 3%). The Kenneth Fire vicinity saw sales drop 15% despite a 6% price increase to $1.35 million.
Real estate experts say the patterns reflect Los Angeles' broader housing dynamics, where location, property type and tight inventory continue to shape outcomes more than short-term disaster exposure.
The analysis examined residential sales within three miles of fire boundaries for the nine largest blazes: Palisades, Eaton, Hughes, Kenneth, Hurst, Sepulveda, Sunset, Woodley and Archer. Fire boundaries were sourced through CalFire, with the study comparing February-April 2025 sales to the same period in 2024.
The findings suggest that while wildfires create immediate devastation and displacement, they may have less long-term impact on real estate desirability in established, affluent markets than conventional wisdom might suggest.
For buyers and investors, the data indicates that fire risk has not fundamentally altered Los Angeles' competitive housing market, where location and prestige continue to command premium prices even in the shadow of natural disasters.
Not surprised. When you remove that many homes from the market, the market is going to meet the demand on it by raising prices. People are still going to need and want to live in the area.
The map at the bottom seems to tell a differnt story than the headline.
Rich Chinese need a place to park their wealth also.
I read elsewhere that many home sales fail in escrow because the buyer can't get insurance.
And there was some speculation (as there always is) that this latest crisis is the lase straw, and that many people will be leaving California.
Probably a lot different materials and things like in home sprinklers which are not a big cost.
In-home sprinklers won't save a house facing a wildfire's wall of flames.
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