That doesn’t necessarily mean that it was rented out. Kirk says some landlords may prefer to wait until they can lease them for more than Newsom’s 10% cap. According to real estate agents, people who were thinking of renting out their second homes in LA have changed their minds, claiming they’re worried about overcharging and breaking the law.
As a result, there are a lot of homes sitting empty when the fires have sent thousands of people scrambling. “This is a big learning lesson for politicians about the housing system we’ve created in LA where we prioritize profit over housing people,” Kirk says. “We need to get hard on vacancy control. We’re understanding that, Oh, shit, this housing system we’ve built up in the aftermath of World War II when we moved away from public housing is failing us.”
Well, not all of us. Los Angeles’s superrich already appear to be tiring of the rental market after three weeks of looking. For some of them, the mantra is now “buy, baby, buy.” A house in Cheviot Hills listed for nearly $3 million sold this week for $6 million—a price so extravagant that real estate agents all over town are astonished.
“I’ve never seen anything like this before,” says one agent, noting that even during COVID the highest they’d seen anyone pay over the asking price was $1 million. “Is there a gold vein under [that house] or something?” Another property, which was listed for $4.2 million, had been sitting on the market for about 60 days. Recently, it received five offers at, or over, the asking price. Despite the fact that the fires weren’t even out yet, Wilder says, a showing of a single-family home in Encino drew 250 people over the course of a weekend. One day later there were multiple all-cash offers, all for hundreds of thousands of dollars over the asking price.
The Palisades has long been considered one of those idyllic places that nobody wants to leave. Similarly, Altadena was considered a bucolic haven with old-growth trees, a well-established Black community, and artists and musicians who were priced out of Silver Lake years ago. But not everybody can buy their way out of this nightmare. Nancy McSween, a Compass real estate agent who’s lived in Altadena since 1978, says some people are leaving because they paid off their mortgages, then let their fire insurance lapse.
Still others discovered that their insurance wouldn’t be renewed not long before the fires broke out. Some people who lost their coverage were reinsured via the state’s Fair Access to Insurance Requirements (FAIR) plan, which provides modest fire coverage to high-risk homes that insurance companies will no longer touch. Senator Alex Padilla recently said the plan had about $377 million to pay claims as of January 10, but Verisk, a global data analytics company, estimates that the fires have caused between $28 billion and $35 billion in property damage. A recent study of the December 2021 Marshall fire in Colorado suggests that many more people will soon discover that they’re underinsured and might not have enough money to build a new home.
Leasing a place while you rebuild your decimated home, buying a new one, or just leaving town altogether—it all feels like defeat to one screenwriter whose family moved out of Malibu after being evacuated during the 2018’s Woolsey Fire. They resettled in the Palisades, which seemed safer, only for their Palisades home to burn down, while the Malibu house remains standing. “For me, the Palisades has basically been nuked,” he says. “If we rebuild, what will it be at the end of it? Is it going to be like Pottersville? Because I think there’s something symbolically resonant about Rick Caruso’s mall being [one of the only things] that survived.” Caruso reportedly hired private firefighters to save his luxury shopping center, Palisades Village, but as one real estate agent observes, “I don’t think a lot of people are going to be rushing in to buy Chanel right now.” (VF has reached out to Caruso’s company for comment.)
The screenwriter is looking at new houses, but when he sees one for sale in the canyons, which serve as fire super-funnels? “I think, Fuck that.” He might move his family to Calabasas, which would be close to where his kids’ schools have temporarily relocated, but, he says, “I’m probably too snooty to live in the valley.”
He might not have a choice. Nobody seems to know how nearly 13,000 homes are going to be rebuilt in anything like a timely fashion, or how fire victims will be relocated in a city, which already has a homeless population of more than 75,000. One agent says he heard a rumor that a large bank is planning to offer interest-free home loans to fire victims. Others say the government is going to have to get involved. Perhaps that’s why Newsom, whom Donald Trump has called “Newscum” on social media, gave the newly elected president a hug when he arrived to tour the damage last week. Said Trump to Newsom, “It’s like you got hit by a bomb.”
“Honey, it’s really hard,” says Wilder, who adds that the community has come together and been exceedingly generous to one another. “I’ve sent 30 pairs of Uggs so far to my real estate friends and clients and anybody that I meet who’s lost their home. Uggs are my love language right now.” Wilder is worried that some fire victims are making big real estate decisions while they’re still in shock, which is not to say that she blames them. “The heartbreak is that it’s really hard to find like-for-like. Clients tell me what they want and I say, ‘You lived in utopia. I can’t find that.’ Not an easy thing to say to people who are traumatized.”